The Production Possibilities Curve Illustrates the Basic Principle That

question 50

Multiple Choice

The production possibilities curve illustrates the basic principle that:

• A)the production of more of any one good will in time require smaller and smaller sacrifices of other goods.
• B)an economy will automatically seek that level of output at which all of its resources are employed.
• C)if all the resources of an economy are in use, more of one good can be produced only if less of another good is produced.
• D)an economy's capacity to produce increases in proportion to its population size.

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Definitions:

Differing Prices

The variation in pricing for goods or services in different markets, customer segments, or purchase situations.

Total Cost Curve

A graphical representation that shows the total cost of producing different quantities of a good or service, including both fixed and variable costs.

Units Produced

The total quantity of goods or products manufactured by a company within a specific time frame.

Sales Revenue

The total amount of money generated from the sale of goods or services before any costs or expenses are deducted.