A model can be accurately described as a
a realistic and carefully constructed theory
b. simplification of reality
c. theoretical abstraction with very little value
d device that is useful only to the people who created it
Production is efficient if the economy is producing at a point
a on or inside the production possibilities frontier
b inside the production possibilities frontier
c outside the production possibilities frontier
d on the production possibilities frontier
Which of the following is an example of a normative, as opposed to positive, statement?
a An increase in the cigarette tax would cause a decrease in the number of smokers
b A law recuing the federal movement to balance is budget would increase economic growth
c A decrease in the minimum wage would decrease unemployment o
d Universe al health care would be good for US citizens
Any point on a country's production possibilities frontier represents a combination of two goods that an e
a can produce using some portion, but not all, of its resources and technology o
b may be able to produce in the future with more resources and/or superior technology e
e will never be able to produce o
d can produce using all available resources and technology
In economics, capital refers to e
a. buildings and machines used in the production process
b stocks and bonds
c the money households use to purchase firms' output o
d the finances necessary for firms to produce their products
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