Explain why in the case of economies of scope the production possibility frontier is bowed outward
What will be an ideal response?
With economies of scope a firm uses less resources if it produces i.e. two goods jointly instead of producing the two goods in two firms separately. This means that the firm can produce more of the two goods when the goods are produced jointly. Hence the bowed outward PPF.
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The table above gives data for the nation of Pearl, a small island in the South Pacific. When the economy is at full employment the price level is
A) 150. B) 110. C) 130. D) 140. E) 120.
If the price of personal computers were to rise, then the demand for printers would decrease because personal computers and printers are
A) complementary goods. B) consumer goods. C) inferior goods. D) substitute goods.
When tastes are quasilinear, the sole reason for the deadweight loss from a per-unit tax is that output falls under the tax.
Answer the following statement true (T) or false (F)
Because two percent of the largest farms grow half of all of the grain in the United States, the grain industry is technically classified as an oligopoly
Indicate whether the statement is true or false