An economy's production of two goods is efficient if
a. all members of society consume equal portions of the goods.
b. the goods are produced using only some of society's available resources.
c. it is impossible to produce more of one good without producing less of the other.
d. the opportunity cost of producing more of one good is zero.
c
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If both borrowers and lenders become discouraged by difficult-to-predict inflation:
A. it will become more difficult for financial intermediation to generate and coordinate savings with investment. B. the excess supply of loanable funds will drive real interest rates higher and higher. C. the velocity of money will increase, leading to higher unemployment and lower real GDP. D. the federal reserve will have to respond by sharply increasing the money supply.
The Bulgarian currency, the lev, is pegged to the euro at a rate of 1.96 leva (leva is the plural of lev) to the euro. At the pegged exchange rate, how many euros would be exchanged for one lev?
A) 0.51 B) 1.00 C) 1.96 D) 3.84