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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