If Production Involves Decreasing Opportunity Cost, the Production Possibilities Curve

question 224

Multiple Choice

If production involves decreasing opportunity cost, the production possibilities curve

• A)is "bowed inward." 
• B)is a straight line.
• C)is "bowed outward." 
• D)is a wavy line.
• E)has an unpredictable shape.

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Definitions:

Subsidy

Financial support provided by the government to businesses, individuals, or other entities, aimed at promoting economic activities or ensuring the affordability of basic goods.

Tariffs

Taxes imposed by a government on imported goods in order to protect domestic industries or to generate revenue.

Quotas

A quota is a government-imposed trade restriction that limits the number or monetary value of goods that can be imported or exported during a specified period.

Free Trade Agreements

Treaties between two or more countries to establish a free trade area, where commerce is conducted without tariffs or restrictions.