Answer the Question on the Basis of the Following Production

question 90

Multiple Choice

Answer the question on the basis of the following production possibilities tables for two countries, North Cantina and South Cantina. Refer to the tables. Suppose that North Cantina is producing 2 units of capital goods and 17 units of consumer goods, while South Cantina is producing 2 units of capital goods and 21 units of consumer goods. We can conclude that

• A) North Cantina is fully and efficiently using its resources, but South Cantina is not.
• B) South Cantina is fully and efficiently using its resources, but North Cantina is not.
• C) neither South Cantina nor North Cantina is fully and efficiently using its resources.
• D) both South Cantina and North Cantina are fully and efficiently using their resources.

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Definitions:

Tariff

A levy enforced by the government on products and services that are brought in from foreign countries.

Domestic Producers

Local manufacturers and suppliers who produce goods within a country's borders.

Imported Good

A product or service that is brought into one country from another to be sold or used.

Tariff

A tax imposed by a government on goods and services imported from other countries, affecting the price and availability of those goods.