A Production Possibilities Frontier Shape Is Derived From

question 33

Multiple Choice

A Production Possibilities Frontier shape is derived from:

• A) the physical production function
• B) consumer choices of what to buy
• C) scarcity
• D) the law of diminishing marginal utility

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Definitions:

Fixed-Coefficient Technology

A production process where input ratios are constant and cannot be substituted for one another in the production process.

Demand Function

A mathematical relationship that describes how the quantity demanded of a good or service varies with changes in its price, and possibly other factors.

Horizontal Labor Supply Curve

A graphical representation suggesting that a worker's willingness to work does not change regardless of wage increases over a certain range.

Monopolist

A single seller in a market who has significant control over the price and supply of a product or service.