Explain why a movement from a point inside a production possibilities frontier to the production possibilities frontier is described as a free lunch and a movement along a production possibilities frontier is described as a tradeoff
What will be an ideal response?
The key point to answer this question is the fact that producing more of a good requires more resources. Hence, if all resources are employed efficiently, as is the case when producing on the production possibilities frontier, producing more of one good means reallocating resources away from the production of another good; there is a tradeoff between the two goods. In other words, to produce more of one good, the production of another must be given u
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To test the effectiveness of a newly developed medicine, 300 patients suffering from a heart ailment were divided into two groups of 150 people each
One group was treated with the new medicine, while the other was treated with the existing medicine that is already widely used. In this scenario, identify the treatment group and the control grou
Which of the following applies to the use of money as a unit of account?
I. A unit of account is an agreed measure for stating the prices of goods and services. II. Using money as a unit of account creates a simplified pricing system. III. Economies choose many goods as units of account. A) I only B) II only C) I and III D) I and II