The figure above shows the production possibilities frontier for a country. How does the opportunity cost of compact cars forgone per SUV gained moving from point C to point B compare with the movement from point B to point A?
A) The opportunity cost of moving from point C to point B is greater than the movement from point B to point A.
B) The opportunity cost of moving from point C to point B is less than the movement from point B to point A.
C) The opportunity cost of moving from point C to point B is the same as the movement from point B to point A.
D) The opportunity costs cannot be compared because the units of moving from point C to point B differ from the units of moving from point B to point A.
E) More information is needed to determine how the two opportunity costs compare.
B
You might also like to view...
The long-run supply curve of a firm is:
A) its marginal cost curve. B) its average total cost curve. C) the portion of its marginal cost curve that lies above its average total cost curve. D) the portion of its marginal cost curve that lies below its average total cost curve.
An active deficit:
a. Is the portion of the government deficit that automatically helps a nation from falling further into a recession. b. Is always less than the actual deficit when a nation is currently below full employment. c. Is the difference between government spending and taxes at full employment. d. All of the above are true. e. None of the above is true.