A country produces only apples and bananas. Moving from point A to point B along its production possibilities frontier, 5 apples are forgone and 4 bananas are gained. What is the opportunity cost of a banana?

If a middle-eastern war reduced the quantity of crude petroleum available for export to Japan and the United States by 40%, and the U.S. government responded by imposing price ceilings on petroleum,

A) more petroleum would be available for Japanese users. B) the demand for crude petroleum in the U.S. would increase. C) the demand for natural gas in the U.S. would decline. D) the price of petroleum would rise even higher in Japan. E) all of the above would be likely to result.

The price a perfectly competitive firm receives for its output

A) is determined by the interaction of all sellers and all buyers in the firm's market. B) is determined by the interaction of the firm and all of the consumers who buy from the firm. C) will be lowered by the firm in order to sell more output. D) will not change in response to changes in market demand and supply because the firm is a price taker.