Use the Following to Answer Questions

question 87

Multiple Choice

Use the following to answer questions .
Exhibit: Production Possibilities Curves 1
-(Exhibit: Production Possibilities Curves 1) A movement from F to B

• A) will increase real GDP and represents economic growth.
• B) will increase real GDP but does not represent economic growth.
• C) implies that the country's productive ability has increased.
• D) will not increase real GDP or potential output.

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Definitions:

ATC Curve

The Average Total Cost curve represents the per-unit cost of production (fixed plus variable costs) at different levels of output.

Efficient

The optimal use of resources to achieve the desired ends with minimal waste or effort, often related to production and allocation.

Economy

A system by which goods and services are produced, distributed, and consumed.

Long-Run Equilibrium

A situation in which all firms in a market are making zero economic profit, leading to a stable market condition where no new firms enter or exit.