Unit 1: Basic Economic Concepts

Every choice results in a foregone best alternative, which economists call the

Which of the following is a direct, accurate link within the circular flow?

Which of the following must exist to allow for mutual benefit from specialization and trade between two countries?

Based on this information, which country has a comparative advantage in producing wheat, and what is the opportunity cost of one bushel of wheat for that country?

A production possibilities curve that is bowed outward (concave to the origin) illustrates

Which of the following would most likely cause the production possibilities curve to shift outward?

If a nation is currently producing at a point inside its production possibilities curve, which of the following is true?

According to Say's law,

An economy is producing at a point on its PPF. If total output of consumer goods increases with no change in technology or resources, which of the following must be true?

Based on the table, what is Country B's opportunity cost of producing one unit of Good X?

Which of the following best describes the concept of marginal analysis in economics?

Which of the following would most likely shift a country's PPF inward?

A point beyond (outside) the production possibilities curve represents

Which of the following best illustrates the concept of a positive externality?

In a market economy, the "invisible hand" described by Adam Smith refers to

Based on this data, who has the comparative advantage in producing widgets?

Which of the following is a characteristic of a command economy?

If Country A can produce either 100 units of food or 50 units of clothing, and Country B can produce either 80 units of food or 80 units of clothing, which statement about trade is correct?

Which of the following statements about economic models is correct?

A country is currently operating on its production possibilities curve. If the country increases investment in capital goods today, it should expect which of the following in the future?