1. Marginal cost is the opportunity costof a good or service divided by the number of units produced.of a good or service that exceeds its benefit.that your activity imposes on someone else.that arises from producing one more unit of a good or service.2. The law of demand implies that demand curvesshift leftward whenever the price rises.slope down.shift rightward whenever the price rises.slope up.3. If the United States can increase its production of automobiles without decreasing its production of any other good,the United States must have been producing at a pointon its PPF.within its PPF.beyond its PPF.None of the above is correct because increasing the production of one good without decreasing theproduction of another good is impossible.4. Which of the following is true?productive or technical efficiency occurs anywhere on the production possibilities curveopportunity cost can be measured by the slope of the PPC curve (frontier)allocative efficiency occurs at a specific point (i.e. a specific mix of production) on the productionpossibilities curve (frontier) that is valued above all alternatives.all of the answers are correctnone of the answers are correct5. We measure the marginalcost; person is willing to paycost; person's preferences arebenefit; person must paybenefit; person is willing to pay6. Each point on the production possibilities frontier achieves allocative efficiency.TrueFalse7. If a country must decrease current consumption to increase the amount of capital goods it produces today, then itmust be producing outside the production possibilities frontier and will continue to do so in the future.of a good by what amust be using resources inefficiently today, but will be more efficient in the future.must be producing along the production possibilities frontier today and will see a shift outward of thefrontier in the future if produces more capital goods.must not have private ownership of property and will have to follow planning authorities decisions todayand in the future.8. One of the opportunity costs of economic growth isfor another unit of the good.the gain in future consumption.reduced current consumption.technological change.capital accumulation.

Cost refers to the expense that incur in the process of production of goods and services. There are…

1. Marginal cost is the opportunity cost of a good or service divided by the number of units produced. of a good or service that exceeds its benefit. that your activity imposes on someone else. that arises from producing one more unit of a good or service.

1. Marginal cost is the opportunity cost of a good or service divided by the number of units produced. of a good or service that exceeds its benefit. that your activity imposes on someone else. that arises from producing one more unit of a good or service.

ENGR.ECONOMIC ANALYSIS

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ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

1. Marginal cost is the opportunity cost
of a good or service divided by the number of units produced.
of a good or service that exceeds its benefit.
that your activity imposes on someone else.
that arises from producing one more unit of a good or service.
2. The law of demand implies that demand curves
shift leftward whenever the price rises.
slope down.
shift rightward whenever the price rises.
slope up.
3. If the United States can increase its production of automobiles without decreasing its production of any other good,
the United States must have been producing at a point
on its PPF.
within its PPF.
beyond its PPF.
None of the above is correct because increasing the production of one good without decreasing the
production of another good is impossible.
4. Which of the following is true?
productive or technical efficiency occurs anywhere on the production possibilities curve
opportunity cost can be measured by the slope of the PPC curve (frontier)
allocative efficiency occurs at a specific point (i.e. a specific mix of production) on the production
possibilities curve (frontier) that is valued above all alternatives.
all of the answers are correct
none of the answers are correct
5. We measure the marginal
cost; person is willing to pay
cost; person's preferences are
benefit; person must pay
benefit; person is willing to pay
6. Each point on the production possibilities frontier achieves allocative efficiency.
True
False
7. If a country must decrease current consumption to increase the amount of capital goods it produces today, then it
must be producing outside the production possibilities frontier and will continue to do so in the future.
of a good by what a
must be using resources inefficiently today, but will be more efficient in the future.
must be producing along the production possibilities frontier today and will see a shift outward of the
frontier in the future if produces more capital goods.
must not have private ownership of property and will have to follow planning authorities decisions today
and in the future.
8. One of the opportunity costs of economic growth is
for another unit of the good.
the gain in future consumption.
reduced current consumption.
technological change.
capital accumulation.

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