Suppose the Economy Is Producing at a Point on Its

question 33

Multiple Choice

Suppose the economy is producing at a point on its production possibilities curve where the marginal benefit of an additional unit of housing is $70,000 while the marginal cost of an additional unit of housing is $78,000. In this instance:

• A) the production of housing should decrease.
• B) the production of housing should increase.
• C) the production of housing should not be changed.
• D) the production of housing should be increased only if there are homeless people.

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Definitions:

Oil Hole

A small, designed opening in machinery through which oil is applied for lubrication purposes.

Standard Transmission

A type of gearbox that requires manual operation by the driver to select and engage gears, using a clutch.

Oil Level

The quantity of oil present in an engine or machine, critical for proper lubrication and cooling.

Fill Hole

An opening in a container or machine part designed for introducing fluid or material into the system or component.