When a Production Possibilities Frontier Is Linear, What Does It

question 218

Multiple Choice

When a production possibilities frontier is linear, what does it show?

• A) a truer picture of real life than a bowed-out production possibilities frontier
• B) that resources are perfectly adaptable from the production of one good to another
• C) an example of increasing opportunity cost
• D) an example of decreasing opportunity cost

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Definitions:

New-to-the-world Products

Innovations that create an entirely new market by being the first of their kind.

Late Majority

The last group of buyers to enter a new product market; when they do, the product has achieved its full market potential.

Early Adopters

The second group of consumers in the diffusion of innovation model, after innovators, to use a product or service innovation; generally don’t like to take as much risk as innovators but instead wait and purchase the product after careful review.

Fashion Trends

The direction in which fashion is moving, with changes in consumer preferences leading to the popularity of certain styles, fabrics, or themes in a given season or period.