Chapter 12
General Equilibrium and Welfare
160. If, in a given economy, production is taking place at a point inside the production possibility frontier,
a. resource allocation is technically and allocatively efficient.
b. resource allocation is technically efficient but allocatively inefficient.
c. resource allocation is technically inefficient and allocatively efficient.
* d. resource allocation is technically and allocatively inefficient.
161. An allocation of resources is technically efficient if
a. it is impossible to increa the output of a particular good.
b. it is possible to increa the output of all goods.
* c. it is impossible to increa the output of one good without cutting back on the production of something el.
d. it is possible to increa the output of one good.
162. Consider a twogood production economy in which both goods are produced with fixed proportions production functions. Then, some efficient allocations will exhibit unemployment of some factor providing
* a. the firms u the inputs in different proportions.
b. the firms exhibit diminishing returns to scale.
c. the firms exhibit increasing returns to scale.
d. production can never be efficient if there are unemployed inputs.
163. Suppo two goods (x and y) are being produced efficiently and that the production of x is always more labor intensive than the production of y. Production depen
ds only on two factors (capital and labor); the may be smoothly substituted for each other. The total quantities of the inputs are fixed. An increa in the production of x and a decrea in the production of y will
* a. increa the capitallabor ratio in each firm.
b. decrea the capitallabor ratio in each firm.
c. leave the capitallabor ratio for each firm unchanged.
中国丝绸之路d. increa the capitallabor ratio in y豇豆怎么做 production and decrea the capitallabor ratio in x production.
164. An efficient allocation of productive inputs requires that
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* a. each output has the same rate of technical substitution among inputs ud.
b. each output has the same marginal rate of substitution for consumers.
c. each pair of outputs has the same rate of product transformation.
d. each individual has the same marginal rate of substitution between outputs.
165. The slope of the production possibility frontier shows
雷锋手绘
a. the marginal rate of substitution between the two goods.
* b. the relative marginal costs of the two goods.
c. the efficient combination of outputs possible using fixed amounts of input.
d. the relative marginal productivities of the two goods.
166. The rate of product transformation (RPT) measures the ability of
a. a consumer to trade one good for another while still maximizing his or her utility.
b. a firm to substitute one input for another and still maintain the same production level.
* c. society to substitute the production of one good for another while still using a fixed supply of inputs efficiently.
d. a firm to produce a final good while starting with only natural resources.
167. In an economy consisting of only two goods, corn and cloth, the amount of extra cloth that can be produced efficiently if corn output is reduced by one unit is equal to
a. the rate of technical substitution for corn divided by the rate of technical substitution for cloth.
芦雪庵b. the rate of technical substitution for cloth divided by the rate of technical substitution for corn.
c. the marginal cost of producing cloth divided by the marginal cost of producing corn.
* d. the marginal cost of producing corn divided by the marginal cost of producing cloth.
168. In order to assure allocative efficiency,周公解梦梦见死人
* a. people’s marginal rate of substitution must equal the economy’s rate of product
transformation.
b. people’s marginal rate of substitution must equal the firm’s rate of technical substitution among inputs.
c. a firm’s rate of technical substitution must equal the economy’s rate of product transformation.
d. all of the above.
169. Each of the following factors might interfere with the efficiency of perfect competition except:
a. increasing returns to scale.
b. imperfect price information.
c. externalities.
* d. diminishing returns to scale.
170. The reason externalities distort the allocation of resources is that 忍耐英文
a. too few goods are usually produced.
b. firms often go out of business becau of the externality.
* c. a firm’s private costs do not reflect the social cost of production.
