The Production Possibilities Table Below Shows the Hypothetical Relationship Between

question 37

Multiple Choice

The production possibilities table below shows the hypothetical relationship between the production of capital goods and consumer goods in an economy. Refer to the table above.What is the opportunity cost of producing the first three units of capital goods?

• A) 6 units of consumer goods
• B) 7 units of consumer goods
• C) 15 units of consumer goods
• D) 22 units of consumer goods Producing the first three capital goods requires giving up 15 (22 - 7 = 15)consumer goods.

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Definitions:

Discouraged Workers

Individuals who are not actively looking for employment because they believe no jobs are available for them.

Unemployment Insurance

is a government program that provides temporary financial assistance to eligible workers who are unemployed through no fault of their own.

Misery Index

The misery index is an economic indicator created by adding the unemployment rate to the inflation rate, designed to measure the health of an economy.

Prime Rate

The interest rate that commercial banks charge their most creditworthy customers, often used as a reference rate for various types of loans.