SS141 Macro-Economics Professor Patrick Yanez
Study Questions – “Production Possibility Curve” - Set 3
These questions are to facilitate your discussion groups and/or tutoring sessions. Answers are listed at the end of this
file. Since our class time is limited to introducing new topics, we do not have time to review these questions in class;
please use your discussion group and/or tutoring session to review these questions.
1. In deciding whether to study for an economics quiz or go to a movie, one is confronted by
the idea(s) of:
a) scarcity and opportunity costs.
b) money and real capital.
c) complementary economic goals.
d) full production.
2. Which one of the following expressions best states the idea of opportunity cost?
a) "A penny saved is a penny earned."
b) "He who hesitates is lost."
c) "There is no such thing as a free lunch."
d) "All that glitters is not gold."
3. The fact that the slope of the production possibilities curve becomes steeper as we move
down along the curve indicates that:
a) the principle of increasing opportunity costs is relevant.
b) society's resources are limited.
c) the opportunity cost of producing each product is constant.
d) resources are perfectly shiftable between alternative uses.
4. The idea of opportunity cost:
a) applies to consumers, but not to businesses.
b) applies to businesses, but not to consumers.
c) is relevant to economies of all ideological persuasions.
d) would disappear if we were able to eliminate poverty.
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