Assume That a Change in Government Policy Results in the Increased

question 232

Multiple Choice

Assume that a change in government policy results in the increased production of both consumer goods and investment goods.It can be concluded that:

• A)the economy was suffering from unemployment and/or the inefficient use of resources before the policy change.
• B)the economy's production possibilities curve has been shifted to the left as a result of the policy decision.
• C)this economy's production possibilities curve is convex (bowed inward) as viewed from the origin.
• D)the law of increasing opportunity costs does not apply in this society.

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Definitions:

Contractual Duty

An obligation imposed by a contract that requires a party to act or refrain from acting in a certain manner.

Novation

The act of replacing an obligation to perform with a new obligation or replacing a party to an agreement with a new party.

Discharging Contract

Discharging a contract refers to the process by which parties are released from their obligations under the contract, for reasons such as fulfillment of the contract terms, mutual agreement, or impossibility of performance.

Third Party

An entity that is not directly involved in a transaction or agreement but may be affected by it or have an interest in it.