Question 1

Below are some production possibilities data for the mystical land of Lhanor.

	A	B	C	D	E
Kaldors	0	4	8	12	16
Bouldings	60	54	42	24	0

Refer to the information above to answer this question. Suppose that Lhanor is currently producing combination D. What is the opportunity cost of producing 4 more Kaldors?

		Zero.
		18 Bouldings.
		12 Bouldings.
		6 Bouldings.
		24 Bouldings.

Question 2

Below are some production possibilities data for the mystical land of Lhanor.

	A	B	C	D	E
Kaldors	0	4	8	12	16
Bouldings	60	54	42	24	0

Refer to the information above to answer this question. Approximately how many units of Kaldors can be produced if 48 units of Bouldings are being produced?

		8 Kaldors.
		4 Kaldors.
		16 Kaldors.
		0 Kaldors.
		6 Kaldors.

Question 3

Below are some production possibilities data for the mystical land of Lhanor.

	A	B	C	D	E
Kaldors	0	4	8	12	16
Bouldings	60	54	42	24	0

Refer to the information above to answer this question. Suppose that Lhanor is currently producing combination A. What is the opportunity cost of producing 12 Kaldors?

		24 Bouldings.
		36 Bouldings.
		12 Bouldings.
		60 Bouldings.
		3 Bouldings.

Question 4

Below are some production possibilities data for the mystical land of Lhanor.

	A	B	C	D	E
Kaldors	0	4	8	12	16
Bouldings	60	54	42	24	0

Refer to the information above to answer this question. Suppose that Lhanor is currently producing combination B. What is the opportunity cost of 1 more Kaldor?

		54 Bouldings.
		Approximately 1 Boulding.
		Approximately 3 Bouldings.
		4 Bouldings.
		42 Bouldings.

Question 5

Below are some production possibilities data for the mystical land of Lhanor.

	A	B	C	D	E
Kaldors	0	4	8	12	16
Bouldings	60	54	42	24	0

Refer to the information above to answer this question. Suppose that Lhanor is currently producing combination B. What is the consequence of the production of Kaldors decreasing to 2?

		The output of Bouldings will decrease by approximately 3.
		The output of Bouldings will increase by 6.
		The opportunity cost of Bouldings will rise.
		The output of Bouldings will decrease.
		The output of Bouldings will increase by approximately 3.

Question 6

Below are some production possibilities data for the mystical land of Lhanor.

	A	B	C	D	E
Kaldors	0	4	8	12	16
Bouldings	60	54	42	24	0

Refer to the information above to answer this question. Which of the following statements is correct if Lhanor is currently producing 10 Kaldors and 24 Bouldings?

		All resources must be fully employed.
		18 more units of Bouldings could be produced.
		Graphically, Lhanor is operating inside its PP curve.
		This combination of goods is not possible.

Question 7

Tigris produces only two products: tennis balls and tennis racquets. Each worker comes with a fixed quantity of materials and capital, and the economy's labour force is fixed at 100 workers. The following table indicates the amounts of balls and racquets that can be produced daily with various quantities of labour:

Number of Workers	Daily production of Tennis Balls	Number of Workers	Daily Production of Racquets
0	0	0	0
20	80	20	30
40	150	40	50
60	200	60	65
80	230	80	75
100	250	100	80

a) Can Tigris produce 200 balls and 60 racquets?

	A.	Yes
	B.	No
	C.	Not enough information given to answer this question
	D.	Only if they gain more technology

Question 8

Tigris produces only two products: tennis balls and tennis racquets. Each worker comes with a fixed quantity of materials and capital, and the economy's labour force is fixed at 100 workers. The following table indicates the amounts of balls and racquets that can be produced daily with various quantities of labour:

Number of Workers	Daily production of Tennis Balls	Number of Workers	Daily Production of Racquets
0	0	0	0
20	80	20	30
40	150	40	50
60	200	60	65
80	230	80	75
100	250	100	80

b) What is the total cost of producing 150 balls?

	A.	15 racquets
	B.	50 racquets
	C.	65 racquets
	D.	30 racquets

Question 9

Tigris produces only two products: tennis balls and tennis racquets. Each worker comes with a fixed quantity of materials and capital, and the economy's labour force is fixed at 100 workers. The following table indicates the amounts of balls and racquets that can be produced daily with various quantities of labour:

Number of Workers	Daily production of Tennis Balls	Number of Workers	Daily Production of Racquets
0	0	0	0
20	80	20	30
40	150	40	50
60	200	60	65
80	230	80	75
100	250	100	80

c) What is the total cost of producing 75 racquets?

	A.	170 balls
	B.	230 balls
	C.	250 balls
	D.	80 balls

Question 10

Tigris produces only two products: tennis balls and tennis racquets. Each worker comes with a fixed quantity of materials and capital, and the economy's labour force is fixed at 100 workers. The following table indicates the amounts of balls and racquets that can be produced daily with various quantities of labour:

Number of Workers	Daily production of Tennis Balls	Number of Workers	Daily Production of Racquets
0	0	0	0
20	80	20	30
40	150	40	50
60	200	60	65
80	230	80	75
100	250	100	80

d) If Tigris is currently producing 230 balls, what is the cost of an additional 20 balls?

	A.	30 racquets
	B.	75 racquets
	C.	60 racquets
	D.	85 racquets

Question 11

Tigris produces only two products: tennis balls and tennis racquets. Each worker comes with a fixed quantity of materials and capital, and the economy's labour force is fixed at 100 workers. The following table indicates the amounts of balls and racquets that can be produced daily with various quantities of labour:

Number of Workers	Daily production of Tennis Balls	Number of Workers	Daily Production of Racquets
0	0	0	0
20	80	20	30
40	150	40	50
60	200	60	65
80	230	80	75
100	250	100	80

e) If Tigris is currently producing 30 racquets, what is the cost of an additional 20 racquets?

	A.	30 balls
	B.	80 balls
	C.	170 balls
	D.	250 balls

Question 12

Consider a farmer's production possibilities curve, with corn measured on the vertical axis, and soybeans on the horizontal.

PROVIDE A DETAILED EXPLANATION for the impact of each of the following on the curve: (a) The farmer buys or rents more land. (b) A higher yielding variety of corn seed is developed. (c) The farmer hires 50 percent more farm workers. (d) The price of soybeans increases.

(please be as detailed as possible)

Question 13

Below are some production possibilities data for the mystical land of Ghandor.

	A	B	C	D	E
Arrows	0	1	2	3	4
Viners	20	18	14	8	0

Refer to the information above to answer this question. Suppose that Ghandor is currently producing combination B. How many Viners could be produced if the production of Arrows increased by 2?

		3 units of viners
		4 units of viners
		8 units of viners
		14 units of viners

Question 14

Below are some production possibilities data for the mystical land of Ghandor.

	A	B	C	D	E
Arrows	0	1	2	3	4
Viners	20	18	14	8	0

Refer to the information above to answer this question. What is the opportunity cost of producing the third unit of Arrows?

		1 unit of Viners.
		6 units of Viners.
		8 units of Viners.
		14 units of Viners.

Question 15

Below are some production possibilities data for the mystical land of Ghandor.

	A	B	C	D	E
Arrows	0	1	2	3	4
Viners	20	18	14	8	0

Refer to the information above to answer this question. Suppose that Ghandor is currently producing combination A. What is the opportunity cost of producing 4 units of Arrows.

		Zero.
		4 units of Viners.
		5 units of Viners.
		20 units of Viners.

Question 16

Below are some production possibilities data for the mystical land of Ghandor.

	A	B	C	D	E
Arrows	0	1	2	3	4
Viners	20	18	14	8	0

Refer to the information above to answer this question. Suppose that Ghandor is currently producing combination D. What is the opportunity cost of producing an additional 10 units of Viners?

		1 unit of Arrows.
		2 units of Arrows.
		10 units of Arrows.
		18 units of Arrows.

Question 17

Below are some production possibilities data for the mystical land of Ghandor.

	A	B	C	D	E
Arrows	0	1	2	3	4
Viners	20	18	14	8	0

Refer to the information above to answer this question. Suppose that Ghandor is currently producing combination E. What is the opportunity cost of producing 20 units of Viners?

		0 unit of Arrows.
		2 units of Arrows.
		3 units of Arrows.
		4 units of Arrows.