Which would be least likely to cause the production possibilities curve to shift to the right?
A. an increase in the labor force
B. improved methods of production
C. an increase in the education and training of the labor force
D. a decrease in unemployment
Answer: D
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Assume a group of firms has formed a cartel and the cartel is in engaged in joint profit maximization. As such, each firm, acting in its own interests, has an incentive to expand production up to the point at which:
A) its marginal cost equals the marginal revenue earned by the cartel. B) its marginal cost equals the cartel-determined price of the product being sold. C) its marginal revenue equals the cartel's marginal costs of production. D) its marginal cost equals the cartel-determined marginal revenue from the good being sold.
Len is putting in a new swimming pool. He can either heat his pool with natural gas or with solar power
If he chooses solar power it will cost him more today, but he will recover these costs over the next 7 years in savings on his natural gas bill. The solar heater is expected to last 12 years. Len: A) will put in the solar heater regardless of the discount rate because the savings in natural gas outweigh the initial cost of the solar heater. B) is more likely to install the solar heater as the discount rate increases. C) is more likely to install the solar heater as the discount rate declines. D) will not put in the solar heater unless he is an environmentalist.