Splitting production into tasks done by different workers.A. SpecializationB. Division of laborC. MarketD. Imports

ECHS decides to take out a few computers. The PPF curve has now contracted. 

Government spending and taxes.A. Fiscal policyB. Monetary policyC. Private enterpriseD. Traditional economy

Average cost falls as total output rises.A. Economies of scaleB. Fiscal policyC. ScarcityD. Labor market

_____________ –  a term referring to the fact that for many goods, as the level of production increases, the average cost of producing each individual unit declines.   Skill Specialization Economies of scale Division of labor

Exhibit 2-1 Refer to Exhibit 2-1. The opportunity cost of moving from point B to A is

Goods/services made abroad and sold domestically.A. ImportsB. ExportsC. Market economyD. Division of labor

Exhibit 2-2 Refer to Exhibit 2-2. If PPF2 is the relevant production possibilities frontier, then point __________ is unattainable.

Why is there scarcity? Because the opportunity set determines this. Because theory dictates it. Because our unlimited wants exceed our limited resources Because human wants are limited.

The lesson of __________ is to forget about the money that’s irretrievably gone and instead to focus on the marginal costs and benefits of future options. sunk costs opportunity costs marginal analysis budget constraints