Two countries, Alpha and Beta, have identical production possibilities frontiers illustrated above. If Alpha produces at point a and Beta produces at point b, then ________.
A) Beta's economic growth rate will exceed Alpha's
B) Alpha consumes less than Beta today, but it will grow faster than Beta
C) Alpha's and Beta's economic growth rates will be the same
D) Beta's future consumption will be greater than Alpha's
Question 2
If a price hike of 5 percent increases the quantity demanded of another good by 2 percent, the goods must be ________ and the cross elasticity of demand equals ________.
A) substitutes; 0.40
B) substitutes; 2.5
C) complements; 0.40
D) complements; 2.5
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