Moving on a bowed out PPF, what happens to the opportunity cost of its production as a nation specializes more in one product?
What will be an ideal response?
The bowed out PPF indicates that as the amount of the good produced increases, the good's opportunity cost increases.
You might also like to view...
If the price level doubles, the
A) nominal demand for money doubles. B) nominal demand for money drops by half. C) real demand for money drops by half. D) real demand for money doubles.
In a competitive labor market, what is the profit-maximizing number of workers that a firm will hire?
What will be an ideal response?
To close an inflationary gap through fiscal policy, the government should
a. decrease government spending in order to reduce aggregate demand. b. increase government spending and taxes in order to both increase aggregate demand and aggregate supply. c. decrease government spending in order to increase aggregate supply. d. reduce taxes in order to stimulate investment, and thus increase aggregate supply.
Consumer surplus in the unregulated monopoly market in the figure below is: 
A. $8. B. $4. C. $0. D. $16.