A Major Earthquake Occurs in the Central Part of the United

question 202

Multiple Choice

A major earthquake occurs in the central part of the United States.What impact would this have on the nation's production possibilities frontier and why?

• A) It would shift outward because unemployment would be reduced.
• B) Nothing would happen because the nation would still have the same capabilities.
• C) A tradeoff would occur to replace the resources and goods destroyed.
• D) It would shift inward because some of the nation's resources, such as capital and labor, would be destroyed.
• E) It would not shift because people would get to work to replace any capital that was destroyed.

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Definitions:

Total Revenue

The total amount of money a firm receives from its sales of goods or services, calculated by multiplying the price per unit by the number of units sold.

Average Revenue

The amount of money a company makes for each unit of product sold, which is found by dividing the overall revenue by the number of units sold.

Competitive Market

A market structure characterized by a large number of buyers and sellers, where each has a negligible impact on market price.

Marginal Revenue

The additional income that will be generated by increasing product sales by one unit.