When Production of a Good Can Be Expanded Without Significantly

question 221

Multiple Choice

When production of a good can be expanded without significantly increasing the overall demand for its inputs:

• A) supply for this good will tend to be more inelastic.
• B) supply for this good will tend to be more elastic.
• C) price for the good will be constant.
• D) the elasticity of supply of the product will equal the elasticity of supply of the inputs.

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Definitions:

Allocate Resources

The process of distributing available resources among various competing needs and wants in order to achieve desired outcomes efficiently and effectively.

Efficiently

Attaining the highest level of efficiency by minimizing unnecessary effort or cost.

Externality

A financial consequence related to a product or service that results in advantages or expenses for individuals not involved in making decisions about the amount of production or consumption.

Economic Efficiency

The optimal allocation of resources where goods and services are produced at their lowest possible cost and where those goods and services align with consumers' preferences.