Use this link to access approaite figure: http://www.youtube.com/watch?v=inBYySU

Question

Use this link to access approaite figure: http://www.youtube.com/watch?v=inBYySUQJ1k

This a multiple choice question, pick one answer (A-E)

Please explain why you pick an answer

11.

Consider the economy described by the production possibilities curves in the figure above. Between 1980 and 1990, the economy most likely experienced

A)

an increase in resources associated with producing services.

B)

a decrease in resources associated with producing services.

C)

an increase in resources associated with producing both goods and services.

D)

a decrease in resources associated with producing goods.

E)

an increase in resources associated with producing goods.

11.

Consider the economy described by the production possibilities curves in the figure above. Between 1980 and 1990, the economy most likely experienced

A)

an increase in resources associated with producing services.

B)

a decrease in resources associated with producing services.

C)

an increase in resources associated with producing both goods and services.

D)

a decrease in resources associated with producing goods.

E)

an increase in resources associated with producing goods.

Explanation / Answer

B Max services increased while max goods remained stagnant suggesting that the cost of producing services has decreased.

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