Exhibit 3-10
-Refer to Exhibit 3-10. If Points A and B indicate consumption goods and capital goods for two different economies, other things held constant, which of the economies is likely to grow more rapidly?
A)Economy A
B)Economy B
C)The two economies will grow at the same rate because they are on the same production possibilities curve.
D)How fast either economy grows is uncertain since growth is not influenced by either consumption or investment.

Question

​Exhibit 3-10 
-Refer to Exhibit 3-10. If Points A and B indicate consumption goods and capital goods for two different economies, other things held constant, which of the economies is likely to grow more rapidly?
A)​Economy A 
B)​Economy B 
C)​The two economies will grow at the same rate because they are on the same production possibilities curve. 
D)​How fast either economy grows is uncertain since growth is not influenced by either consumption or investment.

Quizplus · Accepted Answer

Economy A is likely to grow more rapidly because it is investing more in capital goods (point B) than economy B (point A).

​Exhibit 3-10 -Refer to Exhibit 3-10. If Points a and B Indicate

Exhibit 3-10 -Refer to Exhibit 3-10. If Points a and B Indicate