A movement along the production possibilities curve would imply that
A. productivity has increased.
B. society has chosen a different set of outputs.
C. productivity has declined because workers are demanding more leisure.
D. the labor force has grown.
Answer: B
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A necessary condition for "perfect competition" is
A) price searchers. B) price takers. C) legal restrictions on entry into the market. D) a small number of huge firms. E) widespread and long-run economic profits.
The reason why public subsidization of industries in less-developed countries causes slow economic growth is that:
a. when companies face no competition, there is no incentive for them to improve their production. b. too much of the taxpayer's money is spent in these programs. c. consumers tend to develop an aversion for the purchase of subsidized goods and services. d. subsidies tend to create too much competition for products. e. subsidization creates shortage in the product market.
The Reliable Auto Repair Shop is earning a total revenue of $7,000. Its total fixed costs are $700, and its total variable costs are $2,500. The Reliable Auto Repair Shop?s profit is
A. -$1,800. B. $3,800. C. $4,500. D. $6,300.
Refer to the diagram for a monopolistically competitive firm. Long-run equilibrium output will be:
A. greater than E.
B. E.
C. D.
D. C.