Given Below Is the Production Possibilities Schedule for a Small

question 18

Multiple Choice

Given below is the production possibilities schedule for a small island nation in South Pacific that produces capital and consumer goods.
Table 2.2
$\begin{array}{c}\text { Production Possibilities Schedule }\\\begin{array}{|c|c|}\hline \text { Capital Goods } & \text { Conswuer Goods } \\\hline 10 & 0 \\\hline 9 & 1 \\\hline 7 & 2 \\\hline 4 & 3 \\\hline 0 & 4 \\\hline\end{array}\end{array}$
-Refer to Table 2.2. Identify the correct statement.

• A) The best the economy can do is to produce 10 units of capital goods and 4 units of consumer goods.
• B) If the economy produces 10 units of capital goods, it has sufficient resources to produce 4 units of consumer goods.
• C) If the economy produces 10 units of capital goods and no units of consumer goods, there is unemployment.
• D) If the economy produces 4 units of capital goods, it can manage to produce only 3 units of consumer goods.
• E) In order to produce the 10th unit of capital goods, 4 units of consumer goods must be forgone.

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Definitions:

Rational

Pertaining to a number or expression that can be expressed as the quotient or ratio of two integers.

Square Root

The number that produces a specified quantity when multiplied by itself (e.g., the square root of 9 is 3).

Exponents

A mathematical notation indicating the number of times a quantity is multiplied by itself.

Evaluate

To calculate the numerical value or simplify an expression.