The Diagram Below Shows Two Production Possibilities Boundaries for Country

question 30

Multiple Choice

The diagram below shows two production possibilities boundaries for Country X. FIGURE 1- 3
-Refer to Figure 1- 3. If Country X were producing at point C,

• A) it is not possible to move to any point on PPB1 or PPB2 without technological progress.
• B) this is the maximum output possible from given resources.
• C) the opportunity cost of moving to point A is to give up some capital goods.
• D) the opportunity cost of moving to point B is to give up some consumption goods.
• E) the opportunity cost of moving to point A is zero.

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Definitions:

Productivity

The measure of the efficiency of a person, machine, system, etc., in converting inputs into useful outputs.

Output/Input

A measure of efficiency that compares the quantity or quality of outputs (results, products) generated by a system to the inputs (resources, time) used.

Productivity

The measure of how efficiently resources are used to produce outputs.

Inputs

Resources used in the production process to generate outputs, including raw materials, labor, and capital.