A production possibilities curve that is "bowed out" or concave to the origin:
a. illustrates a tradeoff in which the opportunity cost of a good increases with the level of its production.
b. illustrates a tradeoff in which the opportunity cost of a good decreases with the level of its production.
c. illustrates a tradeoff in which the opportunity cost of a good is constant at all levels of production.
d. demonstrates the fallacy of composition.
c
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The idea behind a flat tax is to _____
a. cut taxes on high-income taxpayers b. to raise taxes on high-income taxpayers c. increase progressivity d. minimize the excess burden of the income tax
In analyzing international trade, we often focus on a country whose economy is small relative to the rest of the world. We do so
a. because it is impossible to analyze the gains and losses from international trade without making this assumption. b. because then we can assume that world prices of goods are unaffected by that country's participation in international trade. c. in order to rule out the possibility of tariffs or quotas. d. All of the above are correct.