An increase in growth rates will cause the production possibilities curve to
A) shift inward.
B) become steeper.
C) become flatter.
D) shift outward.
Ques. 2All of the following will affect the position of the demand curve EXCEPT
A) income.
B) taste and preference.
C) changes in expectations of future relative prices.
D) prices of resources used to produce the product.
Ques. 3Social Security taxes are
A) progressive because all workers pay the tax.
B) regressive because higher income workers pay taxes on a smaller percentage of their income.
C) proportional because everyone is charged the same percentage tax rate.
D) regressive because higher income workers don't pay the tax.
Ques. 4Using the above table, what is the opportunity cost of moving from alternative C to alternative D?
A) 60 loaves of bread
B) 2 loaves of bread
C) 30 loaves of bread
D) 1/2 loaf of bread
Ques. 5A tax is sometimes used by government to correct the problems associated with
A) negative externalities.
B) positive externalities.
C) internal benefits.
D) external benefits.
Ques. 6If demand and supply both increase
A) the equilibrium quantity definitely will increase and market clearing price definitely will decrease.
B) the equilibrium quantity definitely will increase and market clearing price definitely will increase.
C) the equilibrium quantity definitely will increase but the change in market clearing price cannot be determined without more information.
D) market clearing price definitely will increase but the change in the equilibrium quantity cannot be determined without further information.
Ques. 7A straight-line production possibilities curve takes this shape because
A) the opportunity cost of producing a good is constant.
B) the opportunity cost of producing more of a good is decreasing.
C) resources are better suited for producing one output than another.
D) resources are fixed.
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