According to the Production Possibility Model, If More Resources Are

question 104

Multiple Choice

According to the production possibility model, if more resources are allocated to the production of physical and human capital, then which of the following is likely to happen?

• A)Fewer goods will be produced for consumption today.
• B)The production possibility frontier will be shifted inward in the future.
• C)Future economic growth will decline.
• D)The country's total production will fall.

---

Definitions:

Incremental Cash Flows

The net additional cash flows generated by a company as a result of taking on a new project or investment.

Leasing vs. Buying

A comparative analysis between renting an asset for a certain period and purchasing the asset outright, each with its own financial implications.

Lessor's Tax Rate

The tax rate applicable to the income earned from leasing assets or property by the lessor.