The notion of opportunity cost can be represented graphically by the
a. area inside the production possibilities frontier.
b. slope of the production possibilities frontier.
c. vertical distance from the horizontal axis to the production possibilities frontier.
d. horizontal distance from the vertical axis to the production possibilities frontier.
e. sum of the horizontal and vertical distances to the production possibilities frontier.
b
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If aggregate expenditure is less than GDP, then inventories rise and GDP falls
Indicate whether the statement is true or false
Which of the following correctly represents the budget deficit?
a. Tax revenue - government purchases b. Tax revenue - government outlays c. Government purchases - tax revenue d. Government outlays - tax revenue e. Government outlays - tax revenue - transfer payments