In the production possibilities frontier depicted in the figure above, what is the opportunity cost of increasing the production of bananas from two million pounds to three million pounds?

At tax rates higher than the tax rate that maximizes tax revenues along a Laffer curve

A) an increase in tax rates increases tax revenues. B) any variation in tax rates has no effect on tax revenues. C) a reduction in tax rates increases tax revenues. D) a reduction in tax rates reduces tax revenues.

If a country wants to keep the domestic currency overvalued against a foreign currency:

A) it will buy both the foreign and domestic currency. B) it will sell both the foreign and domestic currency. C) it will buy the domestic currency and sell the foreign currency. D) it will buy the foreign currency and sell the domestic currency.