In General, the Higher the Proportion of Resources Devoted to Technological

question 71

Multiple Choice

In general, the higher the proportion of resources devoted to technological research in an economy, the

• A)greater will be current consumption.
• B)faster the production possibilities frontier will shift outward.
• C)faster the production possibilities frontier will shift inward.
• D)closer it will come to having a comparative advantage in the production of all goods.
• E)more bowed out will be the shape of the production possibilities frontier.

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Definitions:

ATC Curve

The line that graphically represents the average total costs of production at various levels of output.

Purely Competitive

A market structure characterized by many small firms producing identical products, where no single firm can influence the market price.

Economic Profit

The difference between total revenue and total costs, including both explicit and implicit costs, representing the profit beyond the normal rate of return.

Average Variable Cost

Average variable cost is the total variable cost divided by the quantity of output produced, representing the variable cost per unit of output.