out shape of the production possibilities curve implies a. producers are unable to utilize specialized resources efficiently. b. shifting production from one good to another leads to increasing opportunity costs. c. shifting production from one good to another leads to decreasing opportunity costs. d. when producing two goods, output is maximized when some of each good is produced, rather than producing all of one good or all of the other good. e. none of the above. Answers: 1.d 2.a, 3.e 4.a, 5.b, 6.a, 7.d, 8.d, 9.bShort Answer (6 points) Consider the following information on a group of buyers and sellers.Buyer 1 has marginal benefits for each of three goods equal to $4, $6 and $9.Buyer 2 has marginal benefits for each of three goods equal to $3, $8 and $9.Seller 1 has marginal costs for each of three goods equal to $2, $7 and $9Seller 2 has marginal costs for each of three goods equal to $5, $10 and $11.a. Using this information, construct precise supply and demand tables for this market.b. What are the equilibrium price and quantity outcomes for this market? Explain your answer.SECOND QUIZEcon 2 1.The price of gasoline increases by 20% and remains at the new higher level. Which of the following statements is true?a.Initially after the price change the price elasticity of demand will be less elastic than it will be a few years after the price change.b.Initially after the price change the price elasticity of demand will be more elastic than it will be a few years after the price change.c.Price elasticity of demand for gasoline will not be affected by the change in the price of gasoline over the long run.d.Demand for gasoline will increase after people adjust to the new higher price.2.If the cross-price elasticity of demand between two goods is negative, then the two goods area.substitutes.b.complements.c.normal goods.d. unrelated goods. 3.Refer to Figure 5.5. The demand f...
