Question : 35) When a production possibilities frontier bowed outward, as more : 1241422

35) When a production possibilities frontier is bowed outward, as more of one good is produced, its opportunity cost

A) increases.

B) decreases.

C) remains constant.

D) might increase, decrease, or remain constant depending on how much people value the additional units of the good.

E) cannot be predicted.

36) A bowed out PPF reflects which of the following ideas?

i.Increasing opportunity cost

ii.Resources are not equally productive in all activities.

iii.Prices of goods increase over time.

A) i only

B) i and ii

C) i and iii

D) ii and iii

E) i, ii, and iii

37) If there is increasing opportunity cost, then when moving downward on a production possibilities frontier, the opportunity cost of the good on the horizontal axis ________ as more of the good is produced.

A) increases and the PPF gets steeper

B) increases and the PPF gets flatter

C) decreases and the PPF gets steeper

D) decreases and the PPF gets flatter

E) does not change and the PPF gets steeper

38) A bowed out production possibility frontier shows that the

A) opportunity cost of a good is constant as more of the good is produced.

B) opportunity cost of a good decreases as more of the good is produced.

C) opportunity cost of a good increases as more of the good is produced.

D) opportunity cost relationship is linear.

E) opportunity cost of producing another good is negative.

39) Why does a nation experience increasing opportunity cost?

A) As the nation moves from a production point within the PPF to one on the PPF, opportunity costs increase.

B) As the nation moves from a production point within the PPF to another point also within the PPF, opportunity costs increase.

C) When the amount of resources increases, the opportunity cost of all goods and services increases.

D) Resources are not equally productive in producing different kinds of goods and services.

E) Because the nation cannot produce at the unattainable production points that lie beyond the PPF.

40) The fact of increasing opportunity cost when moving on the PPF means that

A) to increase the production of one product requires larger and larger sacrifices of the other good.

B) to decrease the production of one product requires smaller and smaller sacrifices of the other good.

C) to increase the production of one product requires smaller and smaller sacrifices of the other good.

D) when the government forces a movement from one point on the PPF to another point, no production is lost.

E) the PPF will be a negatively sloped straight line.

41) Production possibilities frontiers usually curve out and away from the origin. The implication is

A) that as resources are used to produce one good, fewer resources are available to produce another good.

B) that the opportunity cost of producing a good goes down as more of that good is produced.

C) technological change is present.

D) that the opportunity cost of producing a good stays the same regardless of how much of that good is produced.

E) some resources are better at producing one good while other resources are better at producing alternative goods.

42) If the production possibilities frontier between two goods were a straight line, then the opportunity cost of one good in terms of another would be

A) constant.

B) increasing.

C) decreasing.

D) zero.

E) either constant, increasing, or decreasing but more information is needed to determine which.

43) If the production possibilities frontier between two goods is a straight line, then the

A) opportunity cost is not a ratio.

B) resources are equally productive in both goods.

C) line does not qualify as a production possibilities frontier because the unattainable production points are too close to the inefficient production points.

D) Both answers A and C are correct.

E) Both answers A and B are correct.

44) As an economy moves down along a straight line production possibilities frontier, what happens to the opportunity cost of producing the good on the horizontal axis?

A) It remains constant.

B) It decreases.

C) It increases.

D) Above the midpoint it decreases until it equals 1 at the midpoint and then it increases.

E) None of these depicts what happens to opportunity cost.