Asked by Deija Williams on Apr 27, 2024
Verified
(Figure: Guns and Butter) Use Figure: Guns and Butter.On this figure,points A,B,E,and F:
A) indicate combinations of guns and butter that society can produce using all of its factors efficiently.
B) indicate increasing opportunity costs for guns but decreasing opportunity costs for butter.
C) indicate that society wants butter more than it wants guns.
D) indicate constant opportunity costs for guns and increasing costs for butter.
Factors Efficiently
refers to the optimal allocation and utilization of resources in production to maximize output without wasting resources.
- Appreciate the trade-offs involved in allocating resources to produce different combinations of goods.
- Understand the principle of increasing opportunity cost and its relationship to the shape of the production possibilities frontier.
Verified Answer
BG
Benjamin GablerMay 02, 2024
Final Answer :
A
Explanation :
A represents combinations of guns and butter that society can produce using all of its factors efficiently. This is because A lies on the Production Possibility Frontier (PPF), which represents the maximum possible output combinations that a society can produce with its given resources and technology, showing that all resources are being used efficiently.
Learning Objectives
- Appreciate the trade-offs involved in allocating resources to produce different combinations of goods.
- Understand the principle of increasing opportunity cost and its relationship to the shape of the production possibilities frontier.
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