Suppose That an Economy Is Producing on Its Production Possibilities

question 129

Multiple Choice

Suppose that an economy is producing on its production possibilities curve but is not producing quantities of each good where the marginal benefit equals the marginal cost for each good.This economy

• A)should not change its production, because it cannot improve its allocation by shifting resources.
• B)can improve its allocation by lowering the unemployment rate.
• C)can improve its allocation by producing more of one good and less of the other.
• D)can improve its allocation by producing more of both goods.

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Definitions:

Sales Commissions

Payments made to sales personnel, often calculated as a percentage of the sales they generate.

Unethical Sales Practices

Business methods that are deceptive, manipulative, or otherwise morally dubious, aimed at persuading customers to make purchases.

CEO's Salaries

The compensation awarded to chief executive officers of corporations, often comprising a mix of salary, bonuses, shares, and other benefits.

Industrial Nations

Countries that are characterized by a significant level of industrialization, with a major part of their economy coming from manufacturing and services.