Table 2.1.1 The Following Table Gives Points on the Production Possibilities Frontier

question 123

Multiple Choice

Table 2.1.1
The following table gives points on the production possibilities frontier for goods X and Y.

-From the data in Table 2.1.1 we can infer that

• A)the economy illustrated has a comparative advantage in the production of Y.
• B)the economy illustrated has a comparative advantage in the production of X.
• C)the opportunity cost of producing an additional unit of Y increases as the production of Y increases.
• D)the opportunity cost of producing an additional unit of Y decreases as the production of Y increases.
• E)none of the above.

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Definitions:

Interest Rates

The expense associated with obtaining a loan, represented as a percentage of the total loan value, usually calculated on a yearly basis.

Short-Duration Bonds

Bonds with a relatively short time to maturity, typically less than five years, which are less sensitive to interest rate changes compared to longer-duration bonds.

Long-Duration Bonds

Bonds with a long time remaining until maturity, typically more sensitive to interest rate changes and offering potentially higher yields.

Zero-Coupon Bond

A debt security that does not pay interest but is traded at a deep discount, offering profit at maturity when it reaches face value.