Use the Following to Answer Questions

question 216

Multiple Choice

Use the following to answer questions:
-(Table: Production Possibilities Schedule I) Use Table: Production Possibilities Schedule I.If the economy produces 2 units of consumer goods per period,it also can produce,at MOST,_____ units of capital goods per period.

• A) 30
• B) 28
• C) 24
• D) 18

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Definitions:

Explicit Costs

Direct, out-of-pocket payments for inputs or resources used in the production of goods or services, such as wages for labor, rent for offices, or materials for production.

Implicit Costs

Implicit costs are the opportunity costs of using resources that a company already owns, representing the potential income lost by not utilizing them elsewhere.

Diseconomies of Scale

A phenomenon where an increase in production leads to higher average costs per unit due to inefficiencies, often occurring when companies become too large.

Average Total Cost

The total cost per unit of output, calculated by dividing the total cost of production by the number of units produced.