An economy produces only two goods, pizzas and cakes. If the opportunity cost of pizzas in terms of cakes is equal to 1/2, the a. in order to produce one more pizza, the economy needs to give up on half a cake in order to produce one more pizza, the economy needs to give up on two cakes b. in order to produce one more cake, the economy needs to give up on half a pizza none of the above is correct C. d.

ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
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QUESTION 3
An economy produces only two goods, pizzas and cakes. If the opportunity cost of pizzas in terms of cakes is equal to 1/2, then
a.
in order to produce one more pizza, the economy needs to give up on half a cake
b.
in order to produce one more pizza, the economy needs to give up on two cakes
С.
in order to produce one more cake, the economy needs to give up on half a pizza
d.
none of the above is correct
O a
QUESTION 4
One way to characterize the difference between positive statements and normative statements is as follows:
Positive statements tend to reflect optimism about the economy and its future, whereas normative statements tend to reflect pessimism about the
a.
economy and its future.
b.
Positive statements offer descriptions of the way things are, whereas normative statements offer opinions on how things ought to be.
Positive statements involve advice on policy matters, whereas normative statements are supported by scientific theory and observation.
с.
d.
Economists outside of government tend to make normative statements, whereas government-employed economists tend to make positive statements.
O a
a all answers.
Transcribed Image Text:QUESTION 3 An economy produces only two goods, pizzas and cakes. If the opportunity cost of pizzas in terms of cakes is equal to 1/2, then a. in order to produce one more pizza, the economy needs to give up on half a cake b. in order to produce one more pizza, the economy needs to give up on two cakes С. in order to produce one more cake, the economy needs to give up on half a pizza d. none of the above is correct O a QUESTION 4 One way to characterize the difference between positive statements and normative statements is as follows: Positive statements tend to reflect optimism about the economy and its future, whereas normative statements tend to reflect pessimism about the a. economy and its future. b. Positive statements offer descriptions of the way things are, whereas normative statements offer opinions on how things ought to be. Positive statements involve advice on policy matters, whereas normative statements are supported by scientific theory and observation. с. d. Economists outside of government tend to make normative statements, whereas government-employed economists tend to make positive statements. O a a all answers.
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