Two reasons why an economy might operate inside of its production possibilities frontier are
a. productive efficiency and technological change
b. depressions and inflation
c. recessions and productive inefficiency
d. opportunity costs and substitutability of resources used in production
e. productive inefficiency and a decrease in the state of technology
C
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Refer to the figure above. What is the domestic demand for calculators in Barylia, once the economy opens up to free trade?
A) 20 units B) 50 units C) 60 units D) 100 units
The owner of a perfectly competitive firm that is earning economic losses in the short run
A) should alter the rate of output in order to increase profitability. B) should cut his own salary in order to reach the break-even point. C) is actually losing more than he thinks because not all of the implicit costs have been considered. D) is earning less than he would if he worked for someone else.