The Downward- Sloping Line in the Diagram Below Shows the Combinations

question 71

Multiple Choice

The downward- sloping line in the diagram below shows the combinations of health care and education expenditures that the government can afford with a given amount of tax revenue. FIGURE 1- 5
-Refer to Figure 1- 5. Suppose the government's current spending is shown by point D. In this case,

• A) more education expenditures can be achieved only by sacrificing some health expenditures.
• B) the government should spend its total budget so as to get to point B, since more health spending and more education spending are both clearly desirable.
• C) the prices of education and health care have increased beyond the government's ability to pay.
• D) more health expenditures can be achieved only by sacrificing some education expenditures.
• E) the government is not spending its total budget.