Refer to the Above Figure

question 196

Multiple Choice

Refer to the above figure. How do you describe what is happening as the economy moves from point A to point B?

• A) The economy has acquired new resources that are well suited for producing wool.
• B) Land that was once used to grow wheat is now being used to graze sheep.
• C) The economy is producing more bread by choosing to produce less wool.
• D) The technology for growing wheat has improved.

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Definitions:

Fuel Sources

Materials or substances used to generate power or energy, typically to produce heat, light, or to power engines.

Inputs

Resources used in the production process, including labor, technology, and materials.

Economies Of Scale

Situation in which output can be doubled for less than a doubling of cost.

Increasing Returns

A situation where the addition of more units of input results in a more-than-proportional increase in output.