In the above graph, if the economy is currently producing at point C and then shifts production to point A, then A. the economy moved from one efficient point to another efficient point. B. the opportunity cost of that shift is 40,000 units of corn. C. the economy moved from an inefficient point to an efficient point. D. both (B) and (C). E. none of the above.
In the above graph, if the economy is currently producing at point C and then shifts production to point A, then A. the economy moved from one efficient point to another efficient point. B. the opportunity cost of that shift is 40,000 units of corn. C. the economy moved from an inefficient point to an efficient point. D. both (B) and (C). E. none of the above.
Principles of Economics 2e
2nd Edition
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:Steven A. Greenlaw; David Shapiro
Chapter7: Production, Costs, And Industry Structure
Section: Chapter Questions
Problem 24RQ: What is a production technology?
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Question
In the above graph, if the economy is currently producing at point C and then shifts production to point A, then
A. the economy moved from one efficient point to another efficient point.
B. the opportunity cost of that shift is 40,000 units of corn.
C. the economy moved from an inefficient point to an efficient point.
D. both (B) and (C).
E. none of the above.
Expert Solution
Step 1
The curve is the production possibilities frontier which shows different combinations of two goods that can be produced with the given level of resources and technology.
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