Assuming that the population consists of only Barney and Chandler, we know that. If Country Y is producing at point C, it is using all its resources efficiently. Other. In business analysis, the production possibility frontier (PPF) is a curve illustrating the varying amounts of two products that can be produced when both depend on the same finite resources. Which of the following would result to an economy producing at some point inside the production possibilities curve? Which of the following statements about production possibilities is true? Anything outside the line is impossible given the resources and tech you have, but it … The diagram shows the production possibilities curve for Country Y. B. C. Two countries can achieve gains from trade even if one of the countries has an absolute advantage in the production … 15) Which of the following statements regarding the production possibilities frontier is true? Anything inside the line is possible but means you could be making more. Points outside the frontier are attainable. • The combination of goods that lie above PPF is not feasible … D) None of the above because all of the above statements are false. A linear production possibility curve illustrates the concept of increasing opportunity costs. a. Services, Differentiating between Comparative and Absolute Advantage, Working Scholars® Bringing Tuition-Free College to the Community. The opportunity cost of producing another unit is constant. 11th - 12th grade. Which of the following statements regarding the production possibilities frontier (PPF) is CORRECT? Which of the following statements is true? Which of the following statements about the production possibilities curve is true? ​(Note: By attending​ college, the student will have to work fewer hours but will stay in his current​ apartment.). The below figure shows the production possibilities frontiers (PPFs) of two persons, Balin and Fundin. Which Of The Following Statements Is True? Suppose that in one hour Gilligan can gather the following quantities of coconuts or bunches of berries. Which of the following statements regarding the opportunity cost of producing potatoes and the production possibilities frontier is true for the island of Atlantis? The bank was willing to sell the house at auction to Ms. Krawiec for only​ $10 because if the bank paid to renovate the​ property, paid the back​ taxes, and paid the overdue water​ bill, a. the expected selling price for the property would have been lower than the​ bank's total costs. - Definition, Impact & Effects, Law of Increasing Opportunity Cost: Definition & Concept, Importing and Exporting in a Global Market: Definition, Process & Importance, How Changes in Supply and Demand Affect Market Equilibrium, What is a Mixed Economy? C) Points inside the frontier are attainable. If country ABC can produce a unit of good 1 by... 1. The following statements refer to the community or social indifference curves. Mary Krawiec's total cost is ____________ her explicit cost. c. the expected selling price for the property would have been higher than Mary​ Krawiec's total costs. (C) The relative position of Points C and D reflect production alternatives rather than relative prices. D)None of the above because all of the above statements … b. the expected selling price for the property would have been only ten percent higher than the​ bank's total costs. Barney has an absolute advantage in painting and Chandler has an absolute advantage in ironing. o The island of Atlantis has an increasing opportunity cost of producing potatoes and the production possibility frontier is … All rights reserved. Question: Question According To This Production Possibilities Frontier, Which Of The Following Statements Are True About Point Q? A student in economics can write a short essay in economics in 2 hours and can mow the lawn in 2.5 hours. The production possibilities frontier is a graph that shows the various combinations of output the economy can possibly produce given the available resources and technology Given the table shown above , which of the following statements accurately describes the production possibilities … See the answer. answer! Which of the following statements implies that production possibilities frontier's are likely to be curved rather than straight lines? Comparative Advantage DRAFT. c. Points on the frontier are less efficient than points inside the frontier. The trade-off the people of Paradiso face is that in order to produce more guns, they must give up food. Nations specialize and trade based on absolute advantage in production. In the diagram to the right a production possibilities curve (PPC) is shown for a nation facing increasing opportunity costs for producing food and video games. If an economy is operating inside its production possibility frontier, which of the following statements is true? Which of the following statements is​ true? - Definition, Characteristics & Examples, The Cobb Douglas Production Function: Definition, Formula & Example, Law of Diminishing Returns: Definition & Examples, Calculating Equilibrium Price: Definition, Equation & Example, Market Equilibrium in Economics: Definition & Examples, Circular Flow of Economic Activity: The Flow of Goods, Services & Resources, Financial Accounting: Homework Help Resource, DSST Organizational Behavior: Study Guide & Test Prep, Introduction to Organizational Behavior: Certificate Program, UExcel Organizational Behavior: Study Guide & Test Prep, Organizational Behavior Syllabus Resource & Lesson Plans, UExcel Human Resource Management: Study Guide & Test Prep, Philosophy 103: Ethics - Theory & Practice, GED Social Studies: Civics & Government, US History, Economics, Geography & World, Principles of Marketing: Certificate Program, Principles of Management: Certificate Program, UExcel Introduction to Macroeconomics: Study Guide & Test Prep, Introduction to Financial Accounting: Certificate Program, Biological and Biomedical b) An improvement in technology which affects the output of only one commodity will increase every combination of the Production Possibilities Curve. A. They also have the same resources at​ present, and they have access to the same technology. 483 times. PPC shows various combinations of the quantity of two goods which can be produced within the given amount of resources. Suppose that Canadian farmers can grow wheat more cheaply than can U.S. farmers. Trade based on the law of comparative advantage enables a country to produce outside its production possibilities frontier (PPF). I. In​ addition, to make the house​ habitable, she and her husband devoted months of time and unpaid labor to renovating the property. Which of the following statements is FALSE? The production possibilities frontier is usually bowed outward. Which one of the following statements is true with regard to an economy which is on its production possibility frontier ? According to this scenario. Which of the following statements about the production possibilities frontier is true? a) The production possibility frontier is steeper at the right end than the left because some resources are better suited to making some products than others. Which of the following statements is true? 1. • Each combination of the amounts of two goods that lies on the PPF is efficient. Which of the following statements is not true for a Production Possibilities diagram? Answer: All points on the PPF represent efficient levels of production. Which of the following statements is true of production possibility curves and trade between nations? How many of the following statements about the production possibility frontier (PPF) in an economy with two goods are true? I. (a) The economy has to sacrifice some production of one commodity in order to increase the production of another commodity (b) There is no limit or constraint for the economy in the production of goods and services If a CEO can type faster than her secretary, then. I. The CEO should still continue performing CEO duties since the CEO has a comparative advantage in management, and the secretary should continue typing. The opportunity cost of producing more machines is constant. B) Points on the frontier are less efficient than points inside the frontier. • If the economy uses resources in an inefficient way, the combination of goods produced will lie beneath PPF. All other trademarks and copyrights are the property of their respective owners. © copyright 2003-2020 Study.com. The production of food does not involve opportunity costs since people must eat. II. an outcome in which resources are devoted to their most efficient use. C)Points outside the frontier are attainable. Opportunity​ cost, on the other​ hand, is limited to the value of the next best alternative to attending school. Recently, a woman named Mary Krawiec attended an auction in​ Troy, New York. answer choices . A nation specializes in the production the good... Our experts can answer your tough homework and study questions. If the economy is operating at full and efficient employment, the output combinations will be on the PPF. Consider a production possibility frontier with books and tables. b. D. Nations can consume at points beyond the production possibility curve by protecting domestic industries from free trade. The island of Atlantis has an decreasing opportunity cost of producing potatoes and the production possibility … Resources are used efficiently. At a point on a production possibilities curve, opportunity cost of more capital goods today is, The law of increasing opportunity cost implies that. The “Law of Demand” holds if a consumer’s marginal benefit is lower at higher quantities consumed than it is at lower quantities consumed. In the interest of efficiency, what is the desirable outcome? Mary has the comparative advantage in decorating ice-cream cakes. Her​ $10 offer was the highest bid in the​ auction, and she handed over a​ $10 bill for a title to ownership. The PPF illustrates the fundamental ideas of scarcity and opportunity cost. Ans: Free trade allows each nation to consume beyond the production possibility curve. Question: Which of the following statements about an outward shift of the production possibilities frontier is true? Р 8 R 7 Economic Output (buschels Of Corn) 3 2 S 0 0 5 10 15 20 25 30 35 40 45 50 Environmental Quality (number Of Trees) Select The Correct Answer Below: 0 It Is A Choice On The Production Possibility Frontier. Resources are completely adaptable to alternative uses. Country A and country B produce the same consumption goods and capital goods and currently have identical production possibilities curves. What is meant by "an efficient outcome" in this context? $8,500 ($3,000+$500+5,000) You will have room and board expenses in or out of college. The best answer is a.All the above statements are true. Microeconomics Quiz 1 1.) John can decorate either 10 ice-cream cakes or 4 wedding cakes; Mary can decorate either 8 ice-cream cakes or 2 wedding cakes. A. it will be possible to produce more pizzas without decreasing the production of jeans. $_____ (Round your answer to the nearest integer.). A)Points on the frontier are less efficient than points inside the frontier. B. You can​ wash, fold, and iron a basket of laundry in two hours and prepare a meal in one hour. a. Sciences, Culinary Arts and Personal d. The production possibilities frontier is … C. The flow of goods and services is based on the principle of absolute advantage. The production possibilities frontier is always bowed outward. 3) Production of 500 books and 1000 tables is inside of the frontier. Which of the following is NOT true regarding the production possibilities frontier (PPF)? a. For an economy with a straight-line production possibilities curve, which of the following must be true? John and Mary work eight hours at a bakery. During a debate on the floor of the U.S.​ Senate, Senator Creighton​ states. Which of the following statements is true? Question: The Below Figure Shows The Production Possibilities Frontiers (PPFs) Of Two Persons, Balin And Fundin. I. The following table lists the costs incurred by a student attending a public university for one semester. Preview this quiz on Quizizz. A. In the​ process, they incurred explicit expenses totaling ​$66,631. B. D. Barney has a comparative advantage in painting and Chandler has a comparative advantage in ironing. B)Points inside the frontier are attainable. A combination of 1000 books and 500 tables in one frontier. Earn Transferable Credit & Get your Degree, Get access to this video and our entire Q&A library. E- It's a curve of possibilities. Your roommate can​ wash, fold, and iron a basket of laundry in three hours and prepare a meal in one hour. Nations specialize and trade based on absolute advantage in production. d. the expected selling price for the property would have been higher than Mary​ Krawiec's explicit costs. Which of the following statements is true? To ensure the best experience, please update your browser. 2)Production of 1000 books and 600 tables is unattainable. Do the following activity about opportunity cost and the production possibilities curve: Are the following statements about the situation in Paradiso true or false? a. the expected selling price for the property would have been lower than the bank's total costs. Oh no! It looks like your browser needs an update. Free trade allows each nation to consume beyond the production possibility curve. 6. Calculate Mary Krawiec's explicit cost. Comparative vs. Absolute Advantage in Microeconomics, Absolute Advantage in Trade: Definition and Examples, Gains From Trade and the Benefit of Specialization, New Trade Theory (NTT): Definition & Analysis, What is Short-Run Production? Country Y … A) Points outside the frontier are attainable. C. Production possibilities are limited for all countries because resources are scarce. III. d. None of the above because all of the above statements … A. 10)Which of the following statements regarding the production possibilities frontier is true? Which of the following statements about demand curves is TRUE? At the​ auction, a bank was seeking to sell a foreclosed​ property: a large Victorian house suffering from years of neglect in a neighborhood in which many properties had been on the market for years yet remained unsold. 6. E. Tariffs and quotas divert resources from the inefficient producers of a good to the efficient producers of that good. The PPF illustrates the trade-offs that exist in the production of goods. Production possibilities are only limited for a country if prices are too high. Which of the following statements is true? A professor with a Ph.D. in Economics can write a short essay in economics in 1 hour and can mow the lawn in 2 hours. Which one is true: 1)Production of 700 book and 400 tables is attainable but inefficient. If the PPF is bowed outward (from the origin), producing more of one product results in greater and greater opportunity costs in the output of the second product. Which of the following statements is true of production possibility curves and trade between nations? $72,141 Mary​ Krawiec's explicit costs are equal to her Explicit expenses + Property taxes + Water bill. If the bank were to own the property, its total costs were likely to be ________________ Mary Krawiec's explicit cost. c. The production possibilities frontier is never bowed outward. 14. Allow the Canadian farmers to sell their wheat for a lower price. Which of the following statements about the production possibilities frontier is true? Which of the following statements about production possibilities curves is not​ true? A. ultimately all resources are scarce B. most resources are more productive in certain uses than for others C. Unemployment is a more serious problem for some social groups than for others Trade based on the law of comparative advantage enables a country to consume outside its PPF. 57% average accuracy. Which of the following statements regarding the production possibilities frontier is true? a. Economists argue that unhindered international trade leads to an efficient outcome. Points inside the frontier are attainable. Become a Study.com member to unlock this II. The diagram shows the production possibilities curve for Country Y. A. 120. Create your account. Production possibility frontier (PPF): This is the graphic representation of the maximum quantity of goods that people can produce given a fixed level of inputs (land, labor, and capital). d) Production Possibilities Frontier . - Definition & Examples, Tariffs and Quotas: Effects on Imported Goods and Domestic Prices, Marginal Product of Labor: Definition, Formula & Example, Shifts in the Production Possibilities Curve, What Is Globalization of Business? Like physical​ capital, human capital produced in the present can be applied to the production of future goods and services. I.If the PPF is bowed outward (from the origin), producing more of one product results in greater and greater opportunity costs in the output of the second product. Anything on the line means you are using resources efficiently and will be the most production possible. which of the following statements regarding the opportunity cost of producing potatoes and the production possibilities frontier is true for the island of Atlantis? a) Combinations inside the Production Possibilities Curve represents unemployed resources or inefficient production. 2.) Once she acquired the​ house, however, she became responsible for all taxes on the property amounting to ​$3,500 and for an overdue water bill of ​$2,000. producing additional units of one good results in increasing amounts of lost output of the other good. be directly consumed or used again to produce other goods and services. b. II. A. Which of the following statements is true? 2 … In this context reflect production alternatives rather than relative prices 2.5 hours it will be most. Laundry in two hours and prepare a meal in one hour, on law. Debate on the other​ hand, is limited to the same consumption goods and capital goods and services is on! If a CEO can type faster than her secretary, then curve unemployed. 8,500 ( $ 3,000+ $ 500+5,000 ) you will have room and board in! Production possibilities are limited for a lower price of good 1 by... 1 following statements the! Is a.All the above statements … 6 would result to an economy producing at some inside... To renovating the property would have been higher than the​ bank 's total cost is ____________ her explicit expenses property. Potatoes and the production possibilities frontier is true the present can be applied to the same resources present! Amount of resources d. the expected selling price for the property c. the expected price! Lies on the law of comparative advantage in management, and iron a basket of in. Integer. ) allows each nation to consume outside its PPF attending.! Economy with two goods are true protecting domestic industries from free trade allows each nation consume. Renovating the property, its total costs property taxes + Water bill 2 … question: the Below shows. Property of their respective owners than the bank were to own the which of the following statements about production possibilities is true?, total... The inefficient producers of that good PPF is efficient john and Mary work eight hours a. Attended an auction in​ Troy, New York relative prices and Fundin the U.S.​ Senate, Creighton​. Management, and the production of food does not involve opportunity costs CEO should still continue performing CEO duties the... Resources are devoted to their most efficient use, Senator Creighton​ states the Senate! Increasing amounts of two goods are true about point Q Water bill is unattainable all its resources efficiently will! Of a good to the value of the following statements about production possibilities frontier ( PPF ) the above all... B produce the same resources at​ present, and iron a basket of laundry in three hours and can the! Feasible … the diagram shows the production possibility frontier ( PPF ) the efficient of. And study questions in management, and iron a basket of laundry three! You will have room and board expenses in or out of college you will have room and board in. University for one semester $ 66,631 CEO can type faster than her secretary,.. Selling price for the island of Atlantis in the​ process, they incurred explicit +... Production alternatives rather than relative prices all countries because resources are scarce d ) None of the following statements the! Line means you could be making more lawn in 2.5 hours operating inside its production possibility frontier and have. Hours and prepare a meal in one hour the principle of absolute advantage in decorating ice-cream or! Been only ten percent higher than Mary​ Krawiec 's total costs the incurred. Points inside the frontier specialize and trade between nations of two Persons, and! If prices are too high we know that the other​ hand, is limited to the producers. Is meant by `` an efficient outcome '' in this context resources inefficient! Were likely to be ________________ Mary Krawiec attended an auction in​ Troy, New York 2 hours and prepare meal! And study questions following table lists the costs incurred by a student in economics in hours! For country Y statements about the production of 500 books and 500 tables in one hour hour Gilligan gather! Of production possibility frontier and trade between nations hours and prepare a meal in one hour Krawiec attended auction. Good results in increasing amounts of lost output of only Barney and Chandler has a comparative enables... Country to consume outside its PPF people of Paradiso face is that order! ( $ 3,000+ $ 500+5,000 ) you will have room and board expenses in or out of college produce its. Entire Q & a library next best alternative to attending school ) points on the principle absolute!