Deltonia produces both consumer and capital goods.If it reduces the percentage of its output devoted to capital goods, then:
A)its rate of growth will tend to decline.
B)its production possibilities curve will necessarily shift to the left.
C)it must also reduce the percentage of its output devoted to consumer goods.
D)its rate of growth will tend to increase.

Question

Quizplus · Accepted Answer

Capital goods are used to increase productivity and efficiency, which contribute to economic growth. Therefore, if the percentage of output devoted to capital goods is reduced, the rate of growth will tend to decline.

Deltonia Produces Both Consumer and Capital Goods