Exhibit 14 Production possibilities eur Consumption 2 goods 10 Capital goods 6.

Question

Exhibit 14 Production possibilities eur Consumption 2 goods 10 Capital goods 6. In Exhibit 14, suppose an economy with the given production possibilities curve is currently located at point A in the figure. Which of the following statements is false? a. This economy could produce more of both capital and consumption goods. b. This economy is experiencing full employment. c. This economy could produce more capital goods while holding fixed the number of consumption goods produced. d- This economy could produce more consu mption goods while holding fixed the number of capital goods produced Not every resource in this economy is being utilized e. 7. At a price of $5, Sam buys 10 units of a product; when the price increases to S6, Sam buys 8 units. Martha says Sam's demand has decreased. Is Martha correct? a. Yes, Martha is correct. Sam's demand has decreased. b. No, Martha is incorrect. Sam's demand has increased. c. No, Martha is incorreet. Sam's quantity demanded has decreased, and his demand has not changed. No, Martha is incorrect. Sam's quantity demanded has increased, and his demand has increased. No, Martha is incorreet. Sam's demand has increased, and his quantity demanded has decreased. d. e. Exhibit 2 Demand curves .Da D,

Explanation / Answer

6) The correct answer to this question is "B". The statement that economy is experiencing full employment is false. At full employment, the economy will be efficient and produce at maximum. Point a doesn't represent an efficient output level.

7) The correct answer "A". Martha is correct Sam's demand has decreased at the given price he is demanding two fewer products.

Related Questions

Navigate

• Browse (All)
• Browse E
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.