Consider a production possibilities boundary showing the possible combinations of military goods and civilian goods that a country can produce. Suppose that the country is currently at a point on the boundary. If the production of military goods is increased, the production of civilian goods will necessarily
A)remain the same.
B)decrease.
C)increase.
D)increase at a decreasing rate.
E)increase at a increasing rate.

Question

Quizplus · Accepted Answer

The production possibilities boundary shows the maximum possible combinations of two goods that a country can produce, given its resources and technology. Therefore, if the country is currently at a point on the boundary and it wants to produce more military goods, it must shift resources away from producing civilian goods. As a result, the production of civilian goods will decrease.

Consider a Production Possibilities Boundary Showing the Possible Combinations of Military