Employees at Bank of America are good at providing banking services and workers at Ben & Jerry's are good at making ice cream
If some bankers are moved to making ice cream, we get a small increase in the amount of ice cream produced and a large decrease in the amount of banking services provided. If the PPF has banking services on the vertical axis and ice cream on the horizontal axis, the effect of the change reflects A) decreasing opportunity costs.
B) a bowed out PPF for banking services and ice cream.
C) production efficiency.
D) a shift to a flatter PPF.
B
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Karl can produce either 10 tons of oranges or 5 tons of apples in a year, while Adam can produce either 5 tons of oranges or 10 tons of apples. If the exchange rate between apples and oranges in international markets is 1 ton of oranges per 3 tons of apples: a. Karl and Adam will not trade apples and oranges with one another, since both will specialize in and export oranges to other
countries. b. Karl and Adam will not trade apples and oranges with one another, since both will specialize in and export apples to other countries. c. Karl and Adam will trade apples and oranges with one another. d. Karl and Adam will not specialize or engage in international trade.
Which of the following is NOT a true statement about the Lorenz curve?
A) The Lorenz curve includes both money income and income in kind. B) The Lorenz curve does not include unreported income obtained from the underground economy. C) The Lorenz curve does not consider different sizes of households. D) The Lorenz curve does not consider age differences among wage earners.
Which of the following is NOT characteristic of a good with elastic demand?
A. Buyers are relatively sensitive to price changes. B. The absolute price elasticity of demand is less than 1. C. The percentage change in quantity demanded is greater than the percentage change in price. D. Total revenue decreases if price is increased.
The Federal Open Market Committee consists of
A) the seven member Board of Governors of the Federal Reserve. B) the 12 Federal Reserve Bank Presidents. C) five of the Federal Reserve Bank Presidents. D) the Board of Governors plus five of the Federal Reserve Bank Presidents.