If an economy is represented by a point inside its production possibilities curve
A) it cannot produce more of one product unless it stops producing the other product entirely.
B) it cannot possibly produce more of one product, even if it produces less of another product.
C) it can produce more of one product only if it produces less of another product.
D) it can produce more of one product even if it does not produce less of another product.
D
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Soda and peanuts are complements. Other influences on buying plans remaining the same, a rise in the price of soda
A) increases the demand for peanuts. B) decreases the demand for peanuts. C) decreases the demand for soda. D) increases the demand for soda. E) has no effect on the demand for peanuts, though it does change the quantity demanded of peanuts.
In the Keynesian model when desired investment exceeds desired saving,
A) inventories rise. B) inventories fall. C) the price level rises. D) the price level falls.
If OPEC is an effective cartel,
A. its members set Price =MC. B. its members set Price=MR. C. members agree on output quotas. D. oil prices will be lower than if the market functioned competitively.
An increase in the demand for loanable funds will occur if there is
A) an increase in the real interest rate. B) a decrease in the real interest rate. C) an increase in expected profits from firm investment projects. D) an increase in the nominal interest rate accompanied by an equal increase in inflation.