A Production Possibilities Curve Is Plotted for a Nation Producing

question 37

Multiple Choice

A production possibilities curve is plotted for a nation producing cotton and jute.Which of the following will cause a parallel rightward shift of the production possibilities curve?

• A) The invention of a new fertilizer that increases cotton production by 10 percent, without any effect on jute production
• B) The invention of a new fertilizer that increases jute production by 5 percent, without any effect on cotton production
• C) The invention of a new fertilizer that increases the production of both cotton and jute by 10 percent
• D) A twofold increase in the price of all cotton products and a threefold increase in the price of all jute products

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Definitions:

Representativeness Bias

A cognitive bias in decision-making where the likelihood of an event is estimated based on how similar it is to the population of interest or its parent population.

Availability Bias

A cognitive bias that causes people to overestimate the probability of events associated with memorable or vivid occurrences.

Adjustment Bias

A cognitive bias influencing how individuals respond or adapt to new or changing information, often hindering accurate decision-making.

Lack-of-participation Error

Lack-of-participation error occurs when decision-making or evaluation processes are hindered due to the absence or minimal involvement of key individuals.