If the Production Possibilities Frontier Between Bottled Water and Water

question 163

Multiple Choice

If the production possibilities frontier between bottled water and water in a jug is a straight line,which of the following statements would be correct?

• A) A large amount of unemployment must exist.
• B) Resources are equally productive at producing either product.
• C) There is no tradeoff between the two goods.
• D) There is no decrease in the production of one good when the production of the other is increased.
• E) Producing more of one good gives the economy a free lunch.

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