Hypothetical Production Schedule for a Two-Product Economy -If the Economy Produces 12 Capital Goods and 40 Consumer

question 29

Multiple Choice

Hypothetical Production Schedule for a Two-Product Economy $\begin{array}{ccc}&Units~ of&Units~ of\\\text { Points } & \text { Consumer Goods } & \text { Capital Goods } \\\hline \text { A } & 0 & 20 \\\text { B } & 40 & 16 \\\text { C } & 72 & 12 \\\text { D } & 96 & 8 \\\text { E } & 112 & 4 \\\text { F } & 120 & 0\end{array}$
-If the economy produces 12 capital goods and 40 consumer goods,

• A)it is producing outside its production possibilities curve.
• B)this combination of output will most likely result in economic growth.
• C)the ability to produce more consumer goods can only be realized by sacrificing capital goods.
• D)this economy has some unemployed resources.

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Definitions:

Information-Processing Theorists

Scholars who study how humans mentally process information from their environment, drawing analogies with computer processing.

Short-Term Memory

The part of the memory system where information is stored for a short duration, typically seconds to minutes, without rehearsal.

Information-Processing Theorists

Scholars who study how humans mentally process and store information, drawing analogies to computer processing.

Precausal Reasoning

A type of thinking observed in young children where they make causal inferences that are not based on conventional logic or a clear understanding of cause and effect.