Chapter 2

Question 1

Opportunity Cost

Answer 1

What you sacrifice to get something

Question 2

Production Possibilities Curve

Answer 2

A curve that shows the possible combination of products that an economy can produce, given that its productive resources are fully employed and efficiently used

Question 3

Marginal Benefit

Answer 3

the additional benefit resulting from a small increase in some activity

Question 4

Marginal Cost

Answer 4

The additional cost resulting from a small increase in some activity

Question 5

Nominal Value

Answer 5

the face value of an amount of money

Question 6

Real value

Answer 6

the value of an amount of money in terms of what it can buy