PPC Quiz

If a natural disaster strikes, the production possibilities curve can shift

• No shift
• To the left
• To the right
• Outward on one axis only

What is the production possibilities curve?

• a graph that shows how much an economy can produce between 2 goods
• how much money something is
• the opportunity one has to give up in order to gain something else
• land, labor, capital, entrepreneurs

What does point Y represent on the PPC?

• Efficiency
• Unattainable / impossible
• Inefficency
• Nothing

What is opportunity cost?

• a graph that shows how much an economy can produce between 2 goods
• how much money something is
• the opportunity one has to give up in order to gain something else
• land, labor, capital, entrepreneurs

The production possibilities curve is an illustration of what?

• Opportunity costs and trade-offs
• Only opportunity costs
• Only trade-offs
• none of the above

An incentive is:

• the option to select or make a decision when faced with two or more possibilities
• a conclusion or resolution reached after consideration
• a circumstance that contributes to a result or outcome
• a benefit or cost that influences a person's decision

What does a point outside the production possibility curve indicate?

• The economy is using its resources efficiently

• The production level is attainable with current technology and resources

• The production level is unattainable with current technology and resources

• There is no opportunity cost in production

Which of the following might cause an outward shift of the production possibilities curve? (choose all that apply)

• A computer network shuts down due to a virus

• More people earn bachelor degrees

• A new maching that produces bread faster is invented

• OPEC announces a new source of oil

True or False: A point outside of the Production Possibilities Curve is possible

• True

• False

How does an increase in resources affect the PPC?

• It does not affect the PPC

• It shifts the PPC inward

• It shifts the PPC outward

• It makes the PPC more linear