Use the Following to Answer Question

question 12

Multiple Choice

Use the following to answer question:
-(Figure: Production Possibility Frontier for Tealand) Use Figure: Production Possibility Frontier for Tealand.Tealand is producing at point C on its production possibility frontier.What is the opportunity cost of increasing the production of tea from 20 million cups to 30 million cups?

• A)10 million cups of tea
• B)5 million scones
• C)10 million scones
• D)The answer is impossible to determine from the information given.

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Definitions:

Net Taxes

The difference between total taxes collected by the government and the total transfer payments and non-tax revenues it provides.

Transfer Payments

Payments made by governments to individuals without the expectation of any goods or services in return, such as welfare or social security payments.

Income Tax Rates

The percentage of one's income that is paid to the government as tax, which can vary based on income level and other factors.

Income

Income is the amount of money or its equivalent received during a period of time in exchange for labor, services, or investments.