In the Diagram Below, the Following Would Be a Possible

question 39

Multiple Choice

In the diagram below, the following would be a possible explanation for the difference between PPF1 and PPF2. (Assume the starting point is with all butter and no guns.)

• A)A technological improvement in the production of butter.
• B)A technological improvement in the production of guns.
• C)A dramatic shock to the resources needed to produce butter.
• D)A technological improvement in the production of butter and guns.

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Definitions:

Tariffs

Taxes imposed by a government on imported or occasionally exported goods, often used to protect domestic industries from foreign competition.

Agricultural Act of 2014

A comprehensive statute that governs United States federal farm programs including crop insurance, conservation programs, and nutritional assistance.

Freedom to Farm Act

U.S. legislation passed in 1996 that aimed to reduce government control over farming operations and allow farmers more freedom in their planting decisions.

Countercyclical Payments

Government payments made to farmers and businesses to provide financial support during periods of economic downturn.