The graph above shows the PPC for a country that can produce oil or televisions. The straight line is the trade line and CPC if production is at Point A. Which of the following is a true statement?
A) This country should produce relatively more oil and relatively fewer televisions.
B) This country should produce relatively more televisions and relatively less oil.
C) This country should produce more of both goods.
D) This country is producing the optimal mix of oil and televisions to maximize its income.
A
You might also like to view...
Suppose a developing country experiences a reduction in machinery and capital equipment as foreign entrepreneurs decrease the amount of investment in the economy. As a result,
A) the economy will move up along the long-run aggregate supply curve. B) the long-run aggregate supply curve will shift to the left. C) the long-run aggregate supply curve will shift to the right. D) the economy will move down along the long-run aggregate supply curve.
Suppose consumers expect the price of a good to be higher in the future than it is today. Would the current demand for the good increase or decrease?