Question

5) Which of the following would be likely to change the relative efficiency of trucks versus trains in carrying freight?

A) Higher wages for truck drivers

B) More powerful locomotives

C) Tolls on interstate highways

D) All of the above.

6) Land can be used to grow commercial Christmas trees or pulpwood. Which is the more "economically efficient" use of the land?

A) Raising commercial Christmas trees

B) Raising pulpwood

C) Raising a mixed combination of commercial Christmas trees and pulpwood

D) It depends in part on the relative prices of Christmas trees and pulpwood.

7) There are very few gasoline stations in the downtown areas of large cities basically because

A) it would be too dangerous.

B) it would be an inefficient use of land for the land's owners.

C) most people don't want to buy gasoline while they are downtown.

D) zoning laws prohibit it.

8) "Opportunity cost" is

A) any lost opportunity.

B) the next-best opportunity one sacrifices when making a choice.

C) equal to the ratio between an opportunity gained and an opportunity sacrificed.

D) measured only by monetary payments for a scarce good or service.

9) Lu Thier is an accomplished violin and viola maker. He can make either 6 violins or 6 violas each year, or a combination such as 3 violins and 3 violas. Which statement below is true?

A) The opportunity cost of producing 1 violin is 1 viola.

B) The opportunity cost of producing 1 violin is 3 violas.

C) The opportunity cost of producing 1 violin is 6 violas.

D) The opportunity cost of producing 1 violin is 9 violas.

10) With a good on each axis, the production possibilities frontier is downward-sloping, which suggests

A) there is no limit to the amount of each good that can be produced.

B) the production of one good ultimately means sacrificing production of the other.

C) there are no opportunity costs of producing either of the goods.

D) All of the above are true.

Answer 1