At a Perfectly Competitive Equilibrium with Production and Trade,the Slope

question 114

Multiple Choice

At a perfectly competitive equilibrium with production and trade,the slope of the production possibility curve will be

• A) equal to the slope of the price line faced by the consumers.
• B) steeper than the slope of the price line faced by consumers.
• C) flatter than the slope of the price line faced by consumers.
• D) either steeper or flatter than the price line faced by the consumers, depending upon the relative preferences of the consumers.

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Definitions:

"Created" Industries

Sectors or markets that have emerged as a result of innovation, technological advances, or governmental policy.

Entrepreneurs

Individuals who take the initiative to start and manage a business, taking on financial risks with the aim of making a profit.

Purely Competitive

A market structure characterized by many buyers and sellers, free entry and exit, and a homogeneous product, leading to no single buyer or seller having control over prices.

Economic Profits

Economic profits refer to the excess income earned by firms after accounting for both explicit and implicit costs, serving as a measure of efficiency and profitability.