Figure 1.1 U.S. Production Possibilities Curve

-Refer to Figure 1.1. If the economy moves from point A to point B, it will produce
A) more capital goods, but fewer consumer goods
B) more consumer goods, but fewer capital goods
C) more capital goods, and more consumer goods
D) fewer capital goods, and fewer consumer goods

Question

Figure 1.1 U.S. Production Possibilities Curve
 
-Refer to Figure 1.1. If the economy moves from point A to point B, it will produce
A) more capital goods, but fewer consumer goods 
B) more consumer goods, but fewer capital goods 
C) more capital goods, and more consumer goods 
D) fewer capital goods, and fewer consumer goods

Quizplus · Accepted Answer

Moving from point A to point B on a typical production possibility frontier (PPF) indicates an increase in the production of consumer goods and a decrease in the production of capital goods. This is because the PPF typically illustrates the trade-off between producing two different types of goods, showing how increasing the production of one type of good results in the reduction of the other, assuming all resources are fully and efficiently utilized.