A Production Possibilities Curve Will Shift Inward

question 235

Multiple Choice

A production possibilities curve will shift inward

• A) when the unemployment rate increases.
• B) when production is inefficient.
• C) when resources are expanding.
• D) when a war destroys the capital goods of a country.

Understand the application of classical conditioning principles in various contexts, including legal systems and experimental settings.

Understand and calculate standard deviations, covariances, and correlation coefficients for investment returns.

Comprehend the principles of designing risky portfolios, including the calculation of expected returns and optimal risky portfolio proportion.

Grasp the concepts of complete portfolio and the capital market line.

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Definitions:

Substitution Effect

(1) A change in the quantity demanded of a consumer good that results from a change in its relative expensiveness caused by a change in the good’s own price. (2) The reduction in the quantity demanded of the second of a pair of substitute resources that occurs when the price of the first resource falls and causes firms that employ both resources to switch to using more of the first resource (whose price has fallen) and less of the second resource (whose price has remained the same).

Bilateral Monopoly

A bilateral monopoly occurs when a market consists of only one supplier (monopoly) and one buyer (monopsony), leading to unique negotiations and outcomes concerning prices and quantity.

Monopsonistic Employer

A market situation where a single buyer substantially controls the market as the major purchaser of goods and services offered by many would-be sellers.

Minimum-Wage Legislation

Laws set by governments to establish the lowest amount that employers can pay their workers per hour.