A movement from point C to point B in Figure 17.5 illustrates
A)A decreased capacity to produce.
B)The short-run opportunity cost of achieving long-run economic growth.
C)An unattainable combination of consumption and investment goods.
D)An increase in the unemployment rate.

Question

A movement from point C to point B in Figure 17.5 illustrates
A)A decreased capacity to produce. 
B)The short-run opportunity cost of achieving long-run economic growth. 
C)An unattainable combination of consumption and investment goods. 
D)An increase in the unemployment rate.

Quizplus · Accepted Answer

The movement from point C to point B indicates a decrease in current consumption (moving away from the consumption bundle at point C) in order to increase investment (moving towards the production possibilities curve) with the goal of achieving long-run economic growth. This trade-off represents the short-run opportunity cost of achieving long-run economic growth.

A Movement from Point C to Point B in Figure