If an Economy Produces Only Movies and Computers, Then the Opportunity

question 17

Multiple Choice

If an economy produces only movies and computers, then the opportunity cost of producing more movies is

• A)the value of forgone computer production.
• B)the value of more computer production.
• C)the value of movie production minus the value of computer production
• D)the total value of movie and computer production.
• E)zero because computers and movies are unrelated.

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Definitions:

Income Disparities

The difference in earnings among individuals or groups in the economy, often causing economic inequality.

Government Intervention

Actions by a government to affect the economy, often aiming to correct market failures or promote social welfare.

Imperfect Information

A market condition where all parties do not have equal access to all relevant information.

Life Insurance

A contractual agreement with an insurance company that provides a lump sum payment, known as a death benefit, to beneficiaries upon the insured person's death, in exchange for premium payments.