Moving Between Two Points on a PPF,a Country Gains 6

question 18

Multiple Choice

Moving between two points on a PPF,a country gains 6 automobiles and forgoes 3 trucks.The opportunity cost of 1 automobile is

• A) 3 trucks.
• B) 6 automobiles - 3 trucks.
• C) 2 trucks.
• D) 1/2 of a truck.
• E) 1 automobile.

---

Definitions:

Budget Line

A graphical representation of all possible combinations of two goods that can be purchased with a fixed amount of income.

Money Income

The total amount of monetary earnings received by an individual or household, including wages, salaries, benefits, and income from investments.

Price Increase

A rise in the cost of goods or services, which can be influenced by factors such as inflation, demand, or production costs.

Indifference Curve

A graph representing combinations of two goods that give a consumer equal satisfaction and utility.