Exam 1 - Exam 1 Please write down all your answers on the...

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Exam 1 Please write down all your answers on the answer sheet. Multiple choices 1. The law of increasing costs states that (a) resources can be easily adapted to the production of any good. (b) increasing resource prices are inevitable because of scarcity. (c) opportunity costs decrease as more of a good is produced. (d) opportunity costs increase as more of a good is produced. (e) economic growth is always associated with inflation. 2. A political candidate promises voters more funding for AIDS research and child care, and assures them they will not have to sacrifice any other goods or services to obtain the additional programs. (a) This is possible only in a fully employed economy. (b) This may be possible if the economy has unemployed resources. (c) This is possible if the economy is producing on its production possibilities curve. (d) None of the above. 3. 1
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The graph shows the production possibilities curve for environmental protection services and all other goods and services. The curve drawn implies that the opportunity cost of one more unit of environmental protection services (a) greater at point A than at point B. (b) decreases as more of it is produced. (c) equal at points A and B. (d) is the same at all points no matter how much of it is produced. (e) greater at point B than at point A. 4. This spring, the price of lumber used in construction increased substantially. Which of the following is likely to have caused the price increases? (a) An increase in the supply of lumber.
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Exam 1 - Exam 1 Please write down all your answers on the...

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