If a production possibilities frontier is bowed out (concave to the origin), then production occurs under conditions of
A) constant opportunity costs.
B) increasing opportunity costs.
C) decreasing opportunity costs.
D) infinite opportunity costs.
E) uncertain opportunity costs.
B
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Increasing income tax rates will solve the "Social Security time bomb issue" is an example of
A) a positive economic statement. B) marginal cost exceeding marginal benefit. C) answering the "how" question. D) globalization. E) business economic policy.
In the late 1990s, debt-financed government spending decreased in Mexico. Following this decrease, consumption spending increased. Ricardian equivalence would explain this increase in consumption as the result of:
a. people's expectation of higher future taxes required to pay off government debt. b. people's expectation of lower future taxes that induce them to save less. c. automatic stabilization of the economy. d. the crowding out effect. e. an increase in current household disposable income.
When overall production is taken into account, trade restrictions, such as those enacted by the Smoot-Hawley trade bill,
What will be an ideal response?
A situation in which output decreases while prices increase is often referred to as:
A. inflation. B. negative economic growth. C. a recession. D. stagflation.