A Production Possibilities Curve Always Slopes Downward to the Right

question 5

Multiple Choice

A production possibilities curve always slopes downward to the right because resources

• A)are not scarce.
• B)have no opportunity cost.
• C)are freely available.
• D)are limited.
• E)are not related to outputs.

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Definitions:

Marginal Tax Rate

The tax rate applied to the next dollar of taxable income, indicating how much tax will be paid on an additional dollar earned.

Average Tax Rate

The fraction of total income that is paid as taxes, calculated by dividing the total amount of tax paid by the total income.

Income

The money received by an individual or group for work, from investments, or from other sources, often used as an indicator of economic standing.

Marginal Tax Rate

The percentage of tax applied to your next dollar of income, indicating the tax bracket rate for each additional dollar earned.