Finding out the Tradeoff between Economic Output and Environment

6. In the figure below, moving from point 'd' to point 'a' requires

a. technological change.

b. a decrease in unemployment.

c. reducing the output of consumption goods in order to boost the output of capital goods.

d. both capital accumulation and a decrease in unemployment.

9. When the production possibility frontier is a straight line,

a. opportunity cost is increasing.

b. opportunity cost is constant.

c. opportunity cost is decreasing.

d. resources are not scarce.

10. Production points inside the PPF are

a. efficient but not attainable.

b. efficient and attainable.

c. inefficient and not attainable.

d. inefficient and attainable.

12. A nation consumes at a point outside its PPF

a. when it trades with other nations.

b. when it produces inefficiently.

c. when its PPF is bowed out.

d. never.

13. In the figure below, point A is _____, and point B is _____

a. attainable, attainable.

b. attainable, unattainable.

c. unattainable, attainable.

d. unattainable, unattainable.

14. Production points inside the Production Possibility Frontier (PPF) are

a. efficient but not attainable.

b. efficient and attainable.

c. inefficient and not attainable.

d. inefficient and attainable.

15. Output combinations inside a production possibility frontier

a. are unattainable.

b. are attainable only with the full utilization of all resources.

c. are associated with unused resources.

d. result in more rapid growth.

1. The tradeoff between economic output and the environment can be analyzed with the help of a:

a. demand curve

b. production possibility frontier(PPF)

c. budget line

d. Opportunity cost curve

2. A production possibility curve diagram cannot be used to illustrate

4. A production possibility curve, illustrating the output options for Capital and Consumer goods, shifts to the right because there is

5. The concept of opportunity cost helps an economist understand

a. how resources are allocated in an economy.

b. determine the causes of inflation.

7. As output moves from point a to point b to point c along the PPF in the figure below, the opportunity cost of one more unit of good X

a. rises. The opportunity cost of one more unit of good Y also rises.

b. rises. The opportunity cost of one more unit of good Y falls.

c. falls. The opportunity cost of one more unit of good Y rises.

d. falls. The opportunity cost of one more unit of good Y also falls.

11. A nation produces at a point inside its PPF

a. when it trades with other nations.

b. when it produces inefficiently.

c. when its PPF is bowed out.

d. never.

8. When the production possibility frontier bows outward from the origin,

a. some of the societyʹs resources are unemployed.

b. opportunity costs are constant.

c. opportunity costs are increasing.

d. opportunity costs are decreasing.