-Two countries, Alpha and Beta, have identical production possibilities frontiers. If Alpha produces at point a and Beta produces at point b, then .
A) Beta's future consumption will be greater than Alpha's
B) Alpha consumes less than Beta today, but it will grow faster than Beta
C) Beta's economic growth rate will exceed Alpha's
D) Alpha's and Beta's economic growth rates will be the same

Question

-Two countries, Alpha and Beta, have identical production possibilities frontiers. If Alpha produces at point a and Beta produces at point b, then .
A) Beta's future consumption will be greater than Alpha's 
B) Alpha consumes less than Beta today, but it will grow faster than Beta 
C) Beta's economic growth rate will exceed Alpha's 
D) Alpha's and Beta's economic growth rates will be the same

Quizplus · Accepted Answer

If Alpha is producing at a point that suggests it is investing more in capital goods compared to Beta, it will consume less today but will have a higher growth rate in the future due to increased production capacity.

-Two Countries, Alpha and Beta, Have Identical Production Possibilities Frontiers