When determining the production possibilities curve
A) the trade-off between the goods in the economy remains constant.
B) the amount of productive resources remains constant.
C) the prices of the goods are used.
D) the prices of resources are used.
Answer: B
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The above table gives some of the costs of the Delicious Pie Company. What is the total fixed cost of producing 100 pies?
A) $300 B) $400 C) $700 D) More information is needed to calculate the total fixed cost.
The price of good X is $2.00 and the price of good Y is $1.00. Last year, the price of good X was $1.00 and the price of good Y was $2.00. If a consumer has $100, draw there their budget line for each year (label them accordingly). Add as many indifference curves as needed to show a situation in which the consumer is no better or worse off this year than they were last year. Be sure to label their optimal baskets for both years. Explain why what you have drawn is correct.
What will be an ideal response?