Why is it inefficient for an economy to be inside the production possibilities frontier?
What will be an ideal response?
It is inefficient because the society has the resources to produce more of one or more goods, at no loss of production of any other goods or services. Failure to produce may mean that some resources (labor) are gone forever. The inefficiency can be from either not using all resources, or from assigning inputs to the wrong task, i.e., one for which it is not as productive.
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The spending multiplier is defined as:
a. the ratio of the change in equilibrium output to the initial change in spending. b. the change in initial spending divided by the change in personal income. c. 1 / (marginal propensity to consume). d. 1 / (1 ? marginal propensity to save).
Which two pieces of legislation were passed in 1914?
a. Sherman Antitrust and Clayton Act b. Clayton Act and Robinson-Patman Act c. Robinson-Patman Act and Celler-Kefauver Act d. Clayton Act and Federal Trade Commission Act e. Sherman Antitrust Act and Federal Trade Commission Act.
Lately, the Chinese authorities seem to be backing away from ____ and the Yuan has ____ relative to the dollar
a. managed-float; devalued b. currency peg; depreciated c. floating rate; revalued d. currency peg; appreciated
Refer to the diagram. An increase in quantity supplied is depicted by a
What will be an ideal response?