The accompanying figure shows Avery's weekly production possibilities curve for scarves.
For Avery, the opportunity cost of making a red scarf is:
A. decreasing.
B. 1 blue scarf.
C. increasing.
D. zero.
Answer: B
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Professional baseball teams in the United States use only wooden bats. If aluminum bats were permitted, the likely result would be a
A. shift in the supply curve for aluminum bats. B. shift in the supply curve for wooden bats. C. change in the quantity supplied of aluminum bats. D. persistent shortage of aluminum bats.
Both the nominal rate of interest and the real return on investment increase with the inflation rate
Indicate whether the statement is true or false
In constructing a production possibilities curve, all of the following are assumed EXCEPT
A. the time period involved is fixed. B. resources are fully employed. C. the quantity and quality of resources being used is fixed. D. the state of technology is improving.
The mound-shaped yield curve in the figure above indicates that the inflation rate is expected to
A) remain constant in the near-term and fall later on. B) fall moderately in the near-term and rise later on. C) rise moderately in the near-term and fall later on. D) remain unchanged in the near-term and rise later on.