1- Consider the production possibilities curve (ppc) for a country producing only chesse and wine. The first few resources transferred from cheese to wine productions are: A- those that are most specialized in cheese production B- those that are most specialized in wine production C- those that are least specialized in cheese production D- those that are neither specialized in cheese nor wine production E- those that are highly specialized in both cheese and wine production.
2- Bob and Bill can make 16 toys each if they devote 8 working hours in a day. Further, Bob can repair 4 cars and Bill can repair 2 cars, if they devote 8 working hours in a day. what is the oportunity cost of repairing one car to bill. A- 10 toys B- 8 toys C- 16 toys D- 12 toys E- 4 toys
3- The income elasticity of demand------- A- must be negative because of the law of diminishing marginal utility B- could be positive or negative or zero, depending on the nature of the good. C- must be positive because consumers tend to buy more at higher incomes D- is usually zero because "you can only have so much" E- can never be zero
4- if everyone had the same income, then the lorenz curve would: A- be the line of income equality B- bow down below the line of income equality C- be a parallel line lying below the line of income equality D-bow up above the line of income equality E- be a curve that intersects the line of income equality at its mid-point.