The leader of a federal political party made the

23. The leader of a federal political party made the following campaign promise: "My
administration will increase national defense without requiring sacrifices elsewhere in the
economy." The promise can be kept if:
A. the economy moves along the production possibilities in the direction of a greater
quantity of defense.
B. the economy moves from a point inside the production possibilities curve toward a point
on the production possibilities curve.
C. the production possibilities frontier shifts outward due to an improvement in technology.
D. either b) or c) occurs, but not as a result of a).
Answer: D Reference:

Figure 2-2
24. Refer to Figure 2-2. At Point A in the production possibilities graph shown above, the
economy:
Reference:
25. Refer to Figure 2-2. When the economy moves from Point A to Point B in the diagram
above:
Reference:
26. Philosophers draw a distinction between ___________________, which describe the world as
it is, and normative statements, which describe how the world should be.
Reference:
27. The law of ____________________________ explains why people and societies rarely make
all-or-nothing choices.
A. consumption
B. marginal analysis

C. diminishing marginal utility
D. utility
Answer: C Reference:
28. As a person receives more of a good, the _______________ from each additional unit of the
good declines.
Reference:
29. Which of the following would most likely shift the production possibilities curve inward?
Reference: