AP Macro Final Exam Review Fall 2020

What does point Y represent on the PPC?

• Efficiency
• Unattainable / impossible
• Inefficency
• Nothing

What does point B represent?

• Production at greater than the country's minimum potential
• Production is less than the country's minimum potential
• Productive inefficiency
• Productive efficiency

Which point represents "resources are not being used efficiently, or resources are being wasted or idle"?

• Point A
• Point Y
• Point X
• All of the above

The opportunity cost of a good is

• its price in dollars and cents.

• the alternative goods forgone.

• the price of alternative goods foregone.

• none of the other options

The Welch family has saved some money.  They can spend it on a vacation to the Grand Canyon or build a swimming pool in their back yard.  They decide to spend the money on a swimming pool.  What is the opportunity cost of their decision?

• vacation 
• swimming pool 

Countries will export goods and services that they can produce at lower costs. This is called —

• oligarchy

• monopoly

• comparative advantage

• capitalism

The basis of trade based from the lowest opportunity cost is considered as ____.

• Factor Endowment

• Adam Smith Theory

• Comparative Advantage

• Absolute Advantage

The picture illustrates

• an increase in demand
• a decrease in demand
• an increase in quantity demanded
• a decrease in quantity demanded

The picture illustrates

• an increase in demand
• a decrease in demand
• an increase in quantity demanded
• a decrease in quantity demanded

The picture illustrates

• an increase in supply
• a decrease in supply
• an increase in quantity supplied
• a decrease in quantity supplied