The Downward-Sloping Line in the Diagram Below Shows the Combinations

question 13

Multiple Choice

The downward-sloping line in the diagram below shows the combinations of health care and education expenditures that the government can afford with a given amount of tax revenue. FIGURE 1-6
-Refer to Figure 1-6.Suppose the government's current spending is shown by point D.In this case,

• A)the government is not spending its total budget.
• B)more education expenditures can be achieved only by sacrificing some health expenditures.
• C)more health expenditures can be achieved only by sacrificing some education expenditures.
• D)the government should spend its total budget so as to get to point B,since more health spending and more education spending are both clearly desirable.
• E)the prices of education and health care have increased beyond the government's ability to pay.

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