Consider the production possibilities curve for an economy producing only two commodities wheat (represented on the X axis) and wine (represented on the Y axis). A movement up along the production possibilities curve [PPC] will imply:
a. an increase in wheat production.
b. an increase in both wheat and wine production.
c. a decline in both wheat and wine production.
d. an increase in wine production.
e. no change in either wheat or wine production.
d
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Refer to Table 9.2. (Data are expressed in billions of dollars.)Table 9.2Full Employment Income (Output)Consumers Desire to SpendInvestors Desire to SpendTotal Private SpendingTotal Saving$500$300$250$________$________600375250$________$________700450250$________$________800525250$________$________If the full-employment level of income (YF) in Table 9.2 is $800 billion,
A. The economy is in equilibrium. B. There is an inflationary gap of $250 billion. C. There is a recessionary gap of $275 billion. D. There is a recessionary gap of $25 billion.
The Producer Price Index (PPI) is the best index to measure average price changes faced by
A. Producers. B. Consumers. C. Importers. D. Labor unions negotiating COLAs.