The Negative Slope of the Production Possibilities Curve Is a Graphical

question 294

Multiple Choice

The negative slope of the production possibilities curve is a graphical way of indicating that

• A) any economy "can have its cake and eat it too."
• B) to produce more of one product, we must do with less of another.
• C) the principle of increasing opportunity costs applies to only parts of the economy.
• D) consumers buy more when prices are low than when prices are high.

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Definitions:

Demand Curve

A graph showing the relationship between the price of a good and the quantity of the good that consumers are willing and able to buy at that price.

Elastic

Describes a situation where the quantity demanded of a good or service significantly responds to changes in price.

Oligopoly Pricing

A market pricing strategy used in an oligopoly, where a few firms dominate the market and can significantly influence prices through competitive and collaborative dynamics.

Sticky

Describes prices or wages that are slow to adjust or change in response to changes in supply, demand, or the broader economic environment.