Figure 2-9 -Refer to Figure 2-9,Panel (A)and Panel (B).Which of the Following

question 60

Multiple Choice

Figure 2-9

-Refer to Figure 2-9,Panel (a) and Panel (b) .Which of the following is not a result of the shift of the economy's production possibilities frontier from Panel (a) to Panel (b) ?

• A)the tradeoff between the production of donuts and coffee changes
• B)the opportunity cost of a cup of coffee is higher at all levels of coffee production
• C)production of 4 donuts and 2 cups of coffee becomes possible
• D)production of 1 donut and 4 cups of coffee becomes efficient

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Definitions:

Demand

Demand is an economic principle referring to a consumer's desire and willingness to pay a price for a specific good or service.

Supply

The total amount of a specific good or service that is available to consumers, often influenced by the price as well as other factors.

Equilibrium Price

The price at which the quantity of a good demanded by consumers equals the quantity supplied by producers.

Milk

A nutritious white liquid food produced by the mammary glands of mammals, used as a primary source of nourishment for young mammals before they are able to digest other types of food.