In equilibrium, with diminishing marginal products, the slope of the PPF is equal to:
a. the ratio of prices for the products.
b. the slope of the highest possible indifference curve.
c. the ratio of the marginal products of labor.
d. the ratio of prices for the products, the slope of the highest possible indifference curve, and the ratio of the marginal products of labor.
Ans: d. the ratio of prices for the products, the slope of the highest possible indifference curve, and the ratio of the marginal products of labor.
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Refer to Figure 9.2. A movement from point a to point b could be caused by a(n)
A) increase in government spending. B) decrease in the price of oil. C) decrease in taxes. D) decrease in short-run aggregate supply.
If the supply curves for the following goods were plotted, they all would slope upward except one. Which is the exception?
a. red Corvettes b. yogurt c. diamond rings d. original copies of the Mona Lisa e. wine from Greece