Table 2-5 -Refer to Table 2-5. Table 2-5 Shows One Set of One

question 43

Multiple Choice

Table 2-5
-Refer to Table 2-5. Table 2-5 shows one set of production possibilities. What is the opportunity cost of an increase in the production of wheat from 700 bushels to 1300 bushels?

• A)800 bushels of corn
• B)600 bushels of corn
• C)400 bushels of corn
• D)400 bushels of wheat

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Definitions:

Consumer Surplus

The difference between the total amount consumers are willing to pay for a good or service and the total amount they actually pay.

Deadweight Loss

The decrease in economic productivity that happens when a good or service does not reach, or cannot reach, its equilibrium point.

Consumer Surplus

The difference between the maximum amount consumers are willing to pay for a good or service and the actual amount they do pay.

Tax Revenue

The wealth accumulated by governments through the process of taxation.