In relation to Production Possibilities Curve (PPC), which of the following statements is INCORRECT?
If the PPC curve is not a straight line, the opportunity cost is constant.
The correct answer is option 1. If the PPC curve is not a straight line, the opportunity cost is not constant; it increases or decreases as more resources are shifted between different goods. This is the concept of increasing opportunity costs, which is represented by a concave PPC. The other statements are correct: the PPC is also known as the production possibility boundary, a shift in the PPC curve represents economic growth, and points below the curve indicate underutilized resources or unemployment.
Similar Questions
In relation to Production Possibilities Curve (PPC), which of the following statements is INCORRECT?
The ________ explains the relation between inputs and outputs in a short period.
The laws of _____ describe the technically possible ways of increasing the level of output.
If the proportionate increase in the output is less than proportionate increase in the inputs it is said to be ____ returns.
The Long-Run Analysis of Production is done under which one of the following law of Production?
The ______ is a hypothetical representation of the amount of two different goods that can be obtained by shifting resources from the production of one, to the production of the other.
The curve of production possibility is concave in nature because of ____.
Which of the following is/are true at equilibrium in a perfect competition?
(1) MR = MC
(2) AC = MC = AR = MR
(3) MC is falling
Identify the incorrect statement.
Which of the following is an INCORRECT match in the context of economics?
(i) Study of an individual firm an industry - macro economics
(ii) Want satisfying capacity of a good - utility
(iii) Exchange of apples with eggs - ceteris paribus
Important Questions from Microeconomics
Which of the following statement is correct?
I. Indifference curves are sloping from left to right.
II. Higher indifference curve gives a higher level of utility.
If in a production process, all inputs are tripled, which of the following statements follows?
I. If the output is tripled, then decreasing returns to scale apply.
II. When the output is doubled, constant returns to scale apply.
III. If the output is more than tripled, then increasing returns to scale apply.
A market, in which there are a large number of firms, homogeneous product, infinite elasticity of demand for an individual firm and no control over price by firms, is termed as________.
If the two goods are substituted, then the indifference curve will be:
The government multiplier is given by (where c = MPC and t = tax rate)
