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Chapter 2, Problem 14P
To determine

To find:

other things being equal, will the future production possibilities curve for this nation be located farther outward if the nation chooses combination F instead C.

Concept introduction:

Opportunity cost: The opportunity cost is defined as the next best activity forgone. This means that if we have to produce more capital goods instead of consumer goods we have to divert more resources for producing capital goods, so there is an opportunity cost for producing more capital goods instead of consumer goods.

Human capital: The human capital is the skills, education and expertise hold by a person.

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