Unit 2 part 2

Question 1

Entrepreneurs bring together the factors of production to produce goods and services

Answer 1

true

Question 2

a decrease in the unemployment rate may be resresented as a movement from a point on the production possibilities frontier to a point outside the frontier

Answer 2

false

Question 3

consider a country that produces only two goods; kayaks and coconuts. Suppose it is possible for this country to increase its production of kayaks without producing fewers coconuts. In this case, its current output combination is efficient

Answer 3

false

Question 4

what is the difference between product markets and factor marters

Answer 4

product markets are markets for goods and services. factor markets are markets for the factors of production, which are the inputs used to make goods and services.

Question 5

what is a production possibilities frontier? what do points along the frontier represent? What do points inside and outside the frontier represent?

Answer 5

a production possibilities frontier is a curce showing the maximin attainable cominations of two products that may be produced with available resources and current technology. points along a production possibilities frontier are attainable with the resources available and are efficient. points inside the frontier are attainable but inefficient. points outside the frontier are simply unefficient.

Question 6

what happens to a country that produces a comination of goods that uses all the resources available in the economy

Answer 6

the country is operaating on its production possibilities frontier.

Question 7

which of the following best explains why the production possibilities frontier is bowed outward rather than being a straight line?

Answer 7

increasing marginal opportunity costs

Question 8

which of the following graphs best represents an increase in the economys resources

Answer 8

the one spaced out

Question 9

which of the following refers to markets where goods such as computers or services such as medial treatment are offered?

Answer 9

product markets

Question 10

in which markets are factors of production such as labor capital natural resources and entrepreneurial ability traded

Answer 10

factor markets

Question 11

which of the following comprises the two key groups of participants in the circular flow of income

Answer 11

households and firms…circle!

Question 12

which of the following is critical for the success of a market system?

Answer 12

to allow individuals or firms to have exclusive use of their property.