What does the production possibility curve imply about the resource allocation?
a. Only some points on the curve are efficient.
b. All points on the curve are equally efficient.
c. A point which lies below the curve is more efficient.
d. A point which lies above the curve is readily achievable.
b
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In Figure 6.7 with a quantity constraint of Q1, the dead weight loss is area:
A. A. B. H + I + J. C. C + F. D. G.
Total variable costs
A. initially decrease and then increase with output. B. always increase with output. C. initially increase as output increases, and then decrease. D. always decrease with output.
Refer to above figure. With a specific tariff of $3 per unit, what is the quantity of Widgets consumed domestically?
What will be an ideal response?
One reason that firms will experience decreasing returns to scale is:
A. the law of diminishing marginal returns. B. the specialization of inputs as scale increases. C. there is some fixed input that isn't being taken into consideration. D. larger firms may be easier to manage effectively.