The Figure Below Shows the Production Possibilities Frontier for Capital

question 132

Multiple Choice

The figure below shows the production possibilities frontier for capital goods and consumption goods. Current production at _____ would lead to the largest outward shift in the production possibilities frontier in a later year _____.

• A) Point a; because this point represents a greater consumption level than point b
• B) Point b; because this point represents greater total production than the other two points
• C) Point c; because this point represents a greater consumption level than the other two points
• D) Point b; because this point represents greater production of capital than point c
• E) Point c; because this point represents greater production of capital than the other two points

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