Macroeconomics

‭7. What would happen if both demand and supply increase at the same time?‬

‭A.‬ ‭Equilibrium quantity certainly increases.‬ ‭B.‬ ‭Equilibrium price certainly decreases.‬ ‭C.‬ ‭Equilibrium quantity may increase, decrease, or remain unchanged.‬ ‭D.‬ ‭Equilibrium price certainly increases.‬

‭8. An economy produces two goods: X and Y. Why is the production possibilities curve curved‬ ‭outwards from the origin?‬ ‭A.‬ ‭All resources are being fully utilized.‬ ‭B.‬ ‭The production of X or Y does not incur an opportunity cost.‬ ‭C.‬ ‭The opportunity cost of producing X or Y is constant.‬ ‭D.‬ ‭Some‬ ‭of‬ ‭the‬ ‭available‬ ‭resources‬ ‭are‬ ‭better‬ ‭suited‬ ‭for‬ ‭the‬ ‭production‬ ‭of‬ ‭X,‬ ‭whereas‬ ‭other‬ ‭resources are better suited for the production of Y.‬ ‭9.‬‭The‬‭following‬‭table‬‭shows‬‭the‬‭quantities‬‭of‬‭scooters‬‭and‬‭skateboards‬‭that‬‭countries‬‭A‬‭and‬‭B‬‭can‬ ‭produce with the same quantity of resources.‬

‭GOODS‬

‭COUNTRY A‬

‭COUNTRY B‬

‭Scooters‬

‭1,000‬

‭2,400‬

‭Skateboards‬

‭500‬

‭800‬

‭Which statement applies to this situation?‬

‭A.‬ ‭Country B will not beneft from trading with country A.‬ ‭B.‬ ‭Country A will import skateboards from country B.‬ ‭C.‬ ‭Country B has a comparative advantage in producing scooters.‬ ‭D.‬ ‭Country A has an absolute advantage in producing both goods.‬

‭10. Which of the following is an example of land as a factor of production?‬

‭A.‬ ‭An airport runway‬ ‭B.‬ ‭The oil processed to make airplane fuel‬ ‭C.‬ ‭A pilot‬ ‭D.‬ ‭An airplane‬

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