Famous insight regarding “an invisible hand” to promote general economic well-being by given by: a.Milton Friedman b.John Keynes c.Adam Smith d.Alfred Marshall A visual model of the economy, that shows how dollars flow through markets among households and firms is: a.Circular-flow diagram b.Dollar-flow diagram c.Production Possibilities Frontier d.Time-series diagramThe ______________ of an item is what must be given up to obtain that item. a.Total cost b.Fixed cost c.Opportunity cost d.Variable cost________________ is almost always caused by excessive growth in the quantity of money, which causes the value of money to fall. a.Inflation b.Depression c.Market failure d.RecessionIf opp. cost remains constant, Production Possibilities Frontier is: a.U-shaped b.L-shaped c.Bow shaped d.A straight lineIf Japan has 30,000 hours of labor available for production per month and It needs 125 & 25 labor hours to Produce one computer and one ton of wheat respectively while America has 50,000 hours of labor available for production per month and It needs 100 & 10 labor hours to Produce one computer and one ton of wheat respectively.Choose the correct statement from the following: a.Japan has absolute advantage over America in the production of computer while America has absolute advantageover Japan in the production of wheat. b.America has absolute advantage over Japan in the production of both computer and wheat. c.America has absolute advantage over Japan in the production of computer while Japan has absolute advantageover America in the production of wheat. d.Japan has absolute advantage over America in the production of both computer and wheat. Production Possibilities Frontier_____________ a.is a graph that shows the combinations of two goods, the economy can possibly produce given the availableresources and the available technology b.shifts towards the left if there is a technological advancement in the economy c.is always a straight line d.is a graph that shows the combinations of all four goods, the economy can possibly produce given the availableresources and the available technology Trade ____________ a.does not make everyone better off b.makes the economy Independent c.makes an economy Interdependent d.is good only for developed countries. The ability to produce a good using fewer inputs than another producer is called a.Goods & Services Advantage b.Factor Advantage c.Input resource advantage d.Absolute advantageMarkets for Goods & Services in the circular flow diagram provides a.Land and labor to the business firms b.revenue to the business firms and goods & services to the households c.factors of production to the households d.raw materials to the business firms

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Answered: Famous insight regarding “an invisible…

Essentials of Economics (MindTap Course List)

8th Edition

ISBN:9781337091992

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter15: Measuring A Nation's Income

Section: Chapter Questions

Problem 6CQQ

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Famous insight regarding “an invisible hand” to promote general economic well-being by given by:

Milton Friedman

John Keynes

Adam Smith

Alfred Marshall

A visual model of the economy, that shows how dollars flow through markets among households and firms is:

Circular-flow diagram

Dollar-flow diagram

Production Possibilities Frontier

Time-series diagram

The ______________ of an item is what must be given up to obtain that item.

	a.	Total cost
	b.	Fixed cost
	c.	Opportunity cost
	d.	Variable cost

________________ is almost always caused by excessive growth in the quantity of money, which causes the value of money to fall.

	a.	Inflation
	b.	Depression
	c.	Market failure
	d.	Recession

If opp. cost remains constant, Production Possibilities Frontier is:

	a.	U-shaped
	b.	L-shaped
	c.	Bow shaped
	d.	A straight line

If Japan has 30,000 hours of labor available for production per month and It needs 125 & 25 labor hours to Produce one computer and one ton of wheat respectively while America has 50,000 hours of labor available for production per month and It needs 100 & 10 labor hours to Produce one computer and one ton of wheat respectively.

Choose the correct statement from the following:

	a.	Japan has absolute advantage over America in the production of computer while America has absolute advantage over Japan in the production of wheat.
	b.	America has absolute advantage over Japan in the production of both computer and wheat.
	c.	America has absolute advantage over Japan in the production of computer while Japan has absolute advantage over America in the production of wheat.
	d.	Japan has absolute advantage over America in the production of both computer and wheat.

Production Possibilities Frontier_____________

	a.	is a graph that shows the combinations of two goods, the economy can possibly produce given the available resources and the available technology
	b.	shifts towards the left if there is a technological advancement in the economy
	c.	is always a straight line
	d.	is a graph that shows the combinations of all four goods, the economy can possibly produce given the available resources and the available technology

Trade ____________

	a.	does not make everyone better off
	b.	makes the economy Independent
	c.	makes an economy Interdependent
	d.	is good only for developed countries.

The ability to produce a good using fewer inputs than another producer is called

	a.	Goods & Services Advantage
	b.	Factor Advantage
	c.	Input resource advantage
	d.	Absolute advantage

Markets for Goods & Services in the circular flow diagram provides

	a.	Land and labor to the business firms
	b.	revenue to the business firms and goods & services to the households
	c.	factors of production to the households
	d.	raw materials to the business firms

Definition Video Definition Ability of a country to produce more output with a given level of input or to produce the same level of output with a lower level of input as compared to the other countries. For example, if Country A produces 200 units with the help of 10 units of labor, and Country B produces 300 units with 10 units of labor, Country A has an absolute advantage in the production of the good. Video

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