TAMU Econ 203 Exam 1 questions with correct answers

Production Possibility CORRECT ANSWER a countries production capabilities modeled by the PPF PPF (Production Possibilities Frontier) CORRECT ANSWER -Line or curve that shows all possible combos of 2 outputs Points on PPF CORRECT ANSWER -points outside line are unattainable -points within are attainable but inefficient -points on line are attainable and efficient Opportunity Cost CORRECT ANSWER tradeoff between producing more of a good, or less of a good Opportunity Cost Formula CORRECT ANSWER -Rise/Run -this answer is often called the marginal cost, but not always ex. can produce 40 bikes or 20 scooters find OC of bikes= 20/40=.5 scooters PPF with labor specialization CORRECT ANSWER the PPF will be concave to the origin benefits of specialization and trade CORRECT ANSWER -improvement in technology/productivity