Exhibit 2-8

question 87

Multiple Choice

Exhibit 2-8
-Current production at which labeled point in Exhibit 2-7 would lead to the largest outward shift in the production possibilities frontier in a later year?

• A)point a because this point represents a greater consumption level than point b
• B)point b because this point represents greater total production than the other two points
• C)point c because this point represents a greater consumption level than the other two points
• D)point b because this point represents greater production of capital than point c
• E)point c because this point represents greater production of capital than the other two points

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Definitions:

Midpoint Formula

A method used in economics to calculate the elasticity of demand or supply by taking the average of the starting and ending prices and quantities.

Hot Dogs

A cooked sausage served in a sliced bun and often topped with condiments, considered a staple of American fast food.

Price Elasticity

The degree to which consumer demand for a merchandise shifts in response to its price alteration.

Midpoint Formula

A mathematical equation used to find the exact center point between two points on a line segment by averaging the x-coordinates and y-coordinates.