A Production Possibilities Curve Shows

question 321

Multiple Choice

A production possibilities curve shows

• A)that resources are unlimited.
• B)that people prefer one of the goods more than the other.
• C)the maximum amounts of two goods that can be produced, assuming the full use of available resources.
• D)combinations of capital and labor necessary to produce specific levels of output.

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Definitions:

Short-Run Phillips

A concept describing the inverse relationship between unemployment and inflation within a short-term period.

Left

Politically, refers to ideologies and movements that typically advocate for social equality, government intervention in the economy to redistribute wealth, and the protection of social welfare programs.

Inflation Expectations

Inflation Expectations are the rate at which people expect prices to rise in the future, influencing their economic decisions.

Long-Run Phillips

The concept in economics that suggests there is no long-term trade-off between inflation and unemployment, indicating that in the long run, the Phillips curve is vertical.