A production possibilities curve that is bowed out or concave to the origin:
a. illustrates a tradeoff in which the opportunity cost of a good increases with the level of its production.
b. illustrates a tradeoff in which the opportunity cost of a good decreases with the level of its production.
c. illustrates a tradeoff in which the opportunity cost of a good is constant at all levels of production.
d. demonstrates the fallacy of composition.
Question 2
If there were no real wealth or interest rate effect, the aggregate demand curve would still be downward sloping.
a. True
b. False
Indicate whether the statement is true or false
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