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Suppose an Economy Produces Two Goods,corn and Wine

Question 41

Multiple Choice

Suppose an economy produces two goods,corn and wine.If the marginal rate of substitution between corn and wine for consumers is not equal to the marginal rate of transformation,it means that:


A) the quantity demanded does not equal the quantity supplied.
B) the economy is operating on the production possibility frontier.
C) both consumers could be made better off with a different distribution of the goods between them.
D) the output mix is not efficient.

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