How Would the Production Possibility Frontier Be Graphed If Opportunity

question 161

Multiple Choice

How would the production possibility frontier be graphed if opportunity costs are constant?

• A)As a ray from the origin
• B)As a positively sloped straight line
• C)As a negatively sloped curve bowed in toward the origin
• D)As a negatively sloped straight line

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Definitions:

Autonomous Consumption

The level of consumption expenditure that occurs when income levels are zero, reflecting the basic level of consumption that does not depend on current income.

APS

An acronym for Average Propensity to Save, which is the ratio of savings to the total net disposable income.

Total Saving

The sum of personal, business, and government savings within an economy.

APS

Average Propensity to Save (APS) is the ratio of total savings to total disposable income, indicating the portion of income that households save rather than spend.