Basic Economic Concepts

Why is a PPC concave?

If the government adds regulations to an industry, this is the curve it shifts

This is the type of economic system the US has

A straight line PPC has constant opportunity costs

This is NOT a shifter of PPC

If price increases, there will be an increase in the quantity demanded of a good

In a scenario where there is a double shift, either the price or the quantity is indeterminate

The government says that the minimum you can charge for something is the price

Who owns all of factors of production in the circular flow model?

A point outside the PPC curve is in a recessionary period

What will happen if the demand curve moves to the right?

All of the points on the curve of a PPC are efficient

This happens with a price ceiling

What will happen to price and quantity if there is a negative supply shock?

This happens with a price floor

As a producer, if I pay more workers more, my input costs will be more

Opportunity cost is all of the choices you could have made instead

Which of these is NOT an example of an inferior good

The government says the maximum that you can charge for something is call the price

Which of these is not a shifter of Demand

The Law of Supply states that there is an inverse relationship between price and quantity supplied