Refer to the Following Figure for the Questions That Follow

question 38

Multiple Choice

Refer to the following figure for the questions that follow.

-As you move from points N to M to L,the opportunity cost of additional apple pie:

• A) decreases due to the law of increasing relative cost.
• B) increases due to the law of increasing relative cost.
• C) decreases due to the law of normative economics.
• D) increases due to the law of marginal analysis.
• E) decreases due to enhancements in technology.

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Definitions:

Total Annual Output

The total value or volume of goods and services produced by an economy within a year.

Germany

A country in Central Europe known for its rich history, economic strength, and contributions to arts, science, and technology.

France

A country in Western Europe known for its rich history, culture, and significant impact on global politics, cuisine, and the arts.

Market Failure

An instance where a laissez-faire market's distribution of goods and services is inefficient, typically resulting in a reduction of collective social welfare.