A Major Earthquake Occurs in the Central Part of the United

question 202

Multiple Choice

A major earthquake occurs in the central part of the United States.What impact would this have on the nation's production possibilities frontier and why?

• A) It would shift outward because unemployment would be reduced.
• B) Nothing would happen because the nation would still have the same capabilities.
• C) A tradeoff would occur to replace the resources and goods destroyed.
• D) It would shift inward because some of the nation's resources, such as capital and labor, would be destroyed.
• E) It would not shift because people would get to work to replace any capital that was destroyed.

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Definitions:

Marginal Cost

Marginal cost is the additional cost incurred from producing one more unit of a good or service.

Producing Bagels

The process of making bagels, which involves mixing, shaping, boiling and then baking dough, typically in a commercial or artisanal bakery setting.

Total Cost

The complete cost of producing a specific quantity of goods or services, including fixed and variable costs.

Average Fixed Cost

Production's unchanging overheads split by the volume of goods produced.