Tackle the Test: Multiple-Choice Questions

1. Question

   Which point(s) on the graph represent productive efficiency?

   A.

   B and C

   B.

   A and D

   C.

   A, B, C, and D

   D.

   A, B, C, D, and E

   E.

   A, B, C, D, E, and F

   Which point(s) on the graph represent productive efficiency?

2. Question

   For this economy, an increase in the quantity of capital goods produced without a corresponding decrease in the quantity of consumer goods produced

   A.

   cannot happen because there is always an opportunity cost.

   B.

   is represented by a movement from point E to point A.

   C.

   is represented by a movement from point C to point B.

   D.

   is represented by a movement from point E to point B.

   E.

   is only possible with an increase in resources or technology.

   For this economy, an increase in the quantity of capital goods produced without a corresponding decrease in the quantity of consumer goods produced

3. Question

   An increase in unemployment could be represented by a movement from point

   A.

   D to point C.

   B.

   B to point A.

   C.

   C to point F.

   D.

   B to point E.

   E.

   E to point B.

   An increase in unemployment could be represented by a movement from point

4. Question

   Which of the following might allow this economy to move from point B to point F?

   A.

   more workers

   B.

   discovery of new resources

   C.

   building new factories

   D.

   technological advances

   E.

   all of the above

5. Question

   This production possibilities curve shows the trade-off between consumer goods and capital goods. Since capital goods are a resource, an increase in the production of capital goods today will increase the economy’s production possibilities in the future. Therefore, all other things equal (ceteris paribus), producing at which point today will result in the largest outward shift of the PPC in the future?

   A.

   A

   B.

   B

   C.

   C

   D.

   D

   E.

   E