ASU Econ 211 Final Exam 2024 with 100% correct answers

What does a production possibilities frontier display? - correct answer Possible combinations of output an economy can produce given available factors of production and technology. What is a normative statement? - correct answer Policymakers should increase the minimum wage to improve standard of living. The opportunity cost of helping a friend move is... - correct answer the next best use of the time and energy spent helping your friend. An entity has a comparative advantage if it can produce what? - correct answer At a lower opportunity cost than another entity. T/F: Suppose the United States has an absolute advantage in the production of oil and wheat. This means that the U.S. would not gain from trading these goods. - correct answer FALSE The United States has a comparative advantage in the production of wheat and an absolute advantage in the production of both apples and wheat relative to Canada. If the U.S. and Canada specialize and trade, the U.S. should produce what? - correct answer Wheat The law of the demand states that if price rises, quantity demanded does what? - correct answer Decreases We would expect demand for cars to increase if... - correct answer The price of gasoline falls. As income increases, consumers purchase more cars. Cars what type of good? - correct answer Normal goods