A Country That Must Decrease Production of One Good in Order

question 245

Multiple Choice

A country that must decrease production of one good in order to increase the production of another

• A) must have private ownership of property.
• B) must be producing on its production possibilities frontier.
• C) must be using resources inefficiently.
• D) must be producing beyond its production possibilities frontier.

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Definitions:

Deadweight Loss

Net loss of total (consumer plus producer) surplus.

Common Property Rights

Legal rights to resources that are accessible to all members of a society or community, such as air, oceans, or wildlife.

Preservation

The act of maintaining or safeguarding something in its original or current state to prevent decay or destruction.

Efficient Outcome

A situation where resources are allocated in the most effective manner, leaving no room for improvement without making someone worse off.