The diagram below shows two production possibilities boundaries for Country X.
FIGURE 1- 4
-Refer to Figure 1- 4.At point B,
A)the opportunity cost of producing an extra unit of consumer goods is higher than at point A.
B)the price of consumer goods is equal to the price of capital goods.
C)the opportunity cost of producing an extra unit of capital goods is higher than at point A.
D)the price of capital goods is higher than the price of consumer goods.
E)Country X is producing too many consumer goods and too few capital goods.

Question

The diagram below shows two production possibilities boundaries for Country X.
  FIGURE 1- 4
-Refer to Figure 1- 4.At point B,
A)the opportunity cost of producing an extra unit of consumer goods is higher than at point A. 
B)the price of consumer goods is equal to the price of capital goods. 
C)the opportunity cost of producing an extra unit of capital goods is higher than at point A. 
D)the price of capital goods is higher than the price of consumer goods. 
E)Country X is producing too many consumer goods and too few capital goods.

Quizplus · Accepted Answer

At point B, if the production possibility frontier is concave, moving from point A to B typically involves a higher opportunity cost for producing additional consumer goods, as resources are reallocated from capital goods, which may be more efficiently produced.

The Diagram Below Shows Two Production Possibilities Boundaries for Country