Why do PPFstypically have a bowed inward shape?

1. Because as we produce more of the x-axis good, we eventually must bring less productive resources to bear.
2. Becausewe do not face trade offs in producing more units of the x-axis good.
3. Becauseproducing more of the x-axis good will put the economy into a recession.
4. Because as weproduce more of the x-axis good, we eventually must bring more productive resources to bear.

Through specialization and trade a nation will...

1.Create short-run costs,as labor is transferred from one industry to another.

2.Lower its standard of living.

3.Consume at a point beyond the boundary of the PPF

4.Both answer 1and 3are correct.

In the market for bicycles,when the prices of bicycles rises...

1.The demand for bicycles will decrease.

2.The quantity of bicycles demanded will decrease.

3.The demand for bicycles will increase.

4.The quantity of bicycles demanded will increase.

Suppose the market for bicycles is in equilibrium.When the cost of aluminum, an input in the production of bicycles, rises...

1. The supply curve for bicycles shift leftward, resulting in a new equilibriumwhere the prices of bicycles is higher and the quantity of bicycles sold is lower.
2. Thesupplycurve for bicycles shift rightward, resulting in a newequilibriumwhere the prices of bicycles is lower and the quantity of bicycles sold is higher.
3. Thedemandcurve for bicycles shift leftward, resulting in a newequilibriumwhere the prices of bicycles is higher and the quantity of bicycles sold is lower.
4. Thedemandcurve for bicycles shift leftward, resulting in a newequilibriumwhere the prices of bicycles is lower and the quantity of bicycles sold is lower.