Foundations of Business 7th Edition Pride Study Guide Practice Questions Answers PDF Download

SolutionManual
FoundationsofBusiness7thEdition
ByWilliamM.Pride,Allchapter1-47

,Chapter 1 A




End of Chapter Questions
A A A




QuizAYourself

ScarcityAimpliesAAthatAAtheAAallocationAAdecisionAAchosenAAbyAsocietyAcan
notAAmakeAAmoreAAofAAanyAoneAAgood.
alwaysAAmakeAmoreAAofAAanyAgood.
typicallyAmakeAmoreAofAoneAgoodAbutAatAtheAexpenseAofAmakingAless
AofAanother.

alwaysAAmakeAAmoreAAofAAallAAgoodsAAsimultaneously.
Explanation:AScarcityAimpliesAthatAchoicesAinvolveAtrade-
offs.

AACSB:AAReflectiveAAThinkingAAAcces
sibility:AKeyboardANavigationAABloom
s:AAUnderstand
Difficulty:AA02AAMediumAAGra
deable:AAautomaticAALearning
Objective:A01-01
Topic:AAEconomicsAAandAAOpportunityACost

AAproductionAApossibilitiesAAfrontierAisAAaAsimpleAmodelAAof
a) allocatingAscarceAinputsAtoAtheAproductionAofAalternativeAoutputs.
priceAandAAproduction/consumptionAAinAAaAAmarket.
theAAcostAAofAAproducingAAgoods.
theAAnumberAAofAAinputsAArequiredAAtoAAproduceAAvaryingAAlevelsAAofAAoutput.AAExp
lanation:ATheAproductionApossibilitiesAfrontierAshowsAtheAquantityAofAtwoAgoodsAtAhatA
canAbeAproduced.AItAimpliesAthatAscarcityArequiresAthatAchoicesAbeAmadeAasAtAoAhowAtoA
useAresources.

AACSB:AAReflectiveAAThinkingAAAcces
sibility:AKeyboardANavigationAABloom
s:AAUnderstand
Difficulty:AA02AAMediumAAGra
deable:AAautomaticAALearning
Objective:A01-01
Topic:AAModelingAOpportunityACostAAUsingAtheAAProductionAAPossibilitiesAAFrontier

,TheAunderlyingAreasonAthatAthereAareAunattainableApointsAonAaAproductionApossiAbilit
iesAfrontierAisAthatAthere
isAAgovernment.
areAalwaysAAchoicesAAthatAAmustAAbeAAmade.
areAscarceAresourcesAAwithinAaAfixedAlevelAofAtechnology.
isAunemploymentAAofAAresources.
Explanation:ATheApointsAoutsideAtheAproductionApossibilitiesAfrontierAareAunattainableA.AT
hisAmeansAthatAcurrentlyAavailableAresourcesAandAtechnologyAareAinsufficientAtoAproduceA
amountsAgreaterAthanAthoseAillustratedAonAtheAfrontier.AOnAaAgraph,AeverytAhingAbeyondAt
heAfrontierAisAunattainable.

AACSB:AAReflectiveAAThinkingAAAcces
sibility:AKeyboardANavigationAABloom
s:AARemember
Difficulty:AA01AAEasyAAGradea
ble:AAautomaticAALearningAOb
jective:A01-01
Topic:AAModelingAOpportunityACostAAUsingAtheAAProductionAAPossibilitiesAAFrontier

TheAunderlyingAreasonAproductionApossibilitiesAfrontiersAareAlikelyAtoAbeAbowAedA
outA(ratherAthanAlinear)AisAbecause
choicesAAhaveAconsequences.
thereAAareAAalwaysAAopportunityAcosts.
someAresourcesAandApeopleAcanAbeAbetterAusedAproducingAoneAgoodArat
herAthanAanother.
thereAisAAalwaysAAsomeAlevelAAofAAunemployment.
Explanation:AAIfAAtheAAproductionAApossibilitiesAAfrontierAAisAAnotAAaAAlineAAbutAAisAAbowedAA
outAawayAfromAAtheAAorigin,AAthenAAopportunityAAcostAAisAAincreasing.AATheAAreasonAAforAAthi
sAAisAthatAAasAAweAAaddAAmoreAAresourcesAAtoAAtheAAproductionAAof,AAforAAexample,AApizza,AA
weAAareAusingAAfewerAAresourcesAAtoAAproduceAAsoda.AACompoundingAAthatAAproblem,AAatAAe
achAAstageAasAAweAAtakeAAtheAAresourcesAAawayAfromAAsodaAAandAAputAAthemAAintoAApizza,AAw
eAAareAAmoviAngAAworkersAAwhoAAareAAworseAAatAApizzaAAproductionAAandAAbetterAAatAAsodaAA
productionAAthan
thoseAmovedAinAtheApreviousAstage.AThisAmeansAthatAtheAincreaseAinApizzaAproductAionAis
AdiminishingAandAtheAlossAinAsodaAproductionAisAincreasing.AAnAeconomistAwAouldAcallAthi

sAanAexampleAofAincreasingAopportunityAcost.AIfAtheAproductionApossibiAlitiesAfrontierAisAaA
straightAlineAthatAisAnotAbowedAoutAawayAfromAtheAorigin,AthenAopportunityAcostAisAconsta
nt.


AACSB:AAKnowledgeAAApplicationAAA
ccessibility:AKeyboardANavigationAABl
ooms:AARemember
Difficulty:AA01AAEasyAAGradea
ble:AAautomaticAALearningAOb
jective:A01-02
Topic:AAAttributesAAofAAtheAProductionAAPossibilitiesAAFrontier

, SupposeAyouAwereAmodelingAtheAimpactAofAtheAintroductionAofAcomputerAautoAmat
ionAintoAmanufacturingAonAaAproductionApossibilitiesAfrontierA(PPF)AwithAtwoAmanufact
uredAgoodsAonAtheirArespectiveAaxes.AItAwouldAbeAmoreAlikelyAthatAtheAr
esultAAwouldAAbe .
generalizedAgrowthAwithAtheAPPFAmovingAbothAupAandAAtoAtheAright.
specializedAAgrowthAAwithAAtheAAPPFAmovingAbothAAupAAandAAtoAAtheAAright.
generalizedAAgrowthAAwithAAtheAAPPFAjustAAmovingAupAAandAAnotAAtoAAtheAAright.
specializedAgrowthAwithAtheAPPFAjustAmovingAupAandAnotAtoAtheAright.AEAxplana
tion:AComputerAautomationAisAaAgeneralAimprovementAinAtechnologyAsoAitAwouldAimpro
veAallAmanufacturing.AAsAaAresult,AitAwouldAresultAinAgeneralizedAgroAwthAandAmoveAth
eAPPFAbothAupAandAtoAtheAright.

AACSB:AAKnowledgeAAApplicationAAA
ccessibility:AKeyboardANavigationAABl
ooms:AARemember
Difficulty:AA01AAEasyAAGradea
ble:AAautomaticAALearningAOb
jective:A01-
03AATopic:AAEconomicAAGrowt
h

TheAoptimizationAAassumptionAsuggestsAAthatAApeopleAAmake
irrationalAAdecisions.
unpredictableAdecisions.
decisionsAtoAmakeAthemselvesAasAwellAoffAasApossible.
decisionsAAwithoutAAthinkingAveryAhard.
Explanation:ATheAoptimizationAassumptionAsuggestsAthatAtheApersonAinAquestionAisAtryi
ngAtoAmaximizeAsomeAobjective.AConsumersAareAassumedAtoAbeAmakingAdecisiAonsAthatA
maximizeAtheirAhappinessAsubjectAtoAaAscarceAamountAofAmoney.

AACSB:AAReflectiveAAThinkingAAAcces
sibility:AKeyboardANavigationAABloom
s:AARemember
Difficulty:AA01AAEasyAAGradea
ble:AAautomaticAALearningAOb
jective:A01-01
Topic:AAThinkingAEconomically