In the Long Run, Immigration Will Shift the Sending Country's

question 102

Multiple Choice

In the long run, immigration will shift the sending country's production possibilities frontier inward. This shift will cause:

• A) a larger decline in the potential output of the capital-intensive good.
• B) a larger decline in the potential output of the labor-intensive good.
• C) equal declines in the potential output of both the labor-intensive and the capital-intensive good.
• D) a decline in the potential output of the labor-intensive good and an increase in the potential output of the capital-intensive good.

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Definitions:

Fixed Costs

Costs that do not change with the level of production or sales, such as rent, salaries, and insurance, necessary for running a business.

Break-Even Point

The juncture where the overall expenses match the total income, resulting in neither a profit nor a loss.

Variable Costs

Costs that vary directly with the volume of production or service delivery, such as materials and labor.

Fixed Costs

Expenses that do not change in total irrespective of the volume of goods or services produced by a company.