The state of Georgia offers free college tuition to high school students with a B average. In 2007, the state raised the requirement so that fewer students qualified for the scholarship.
At the same time, Georgia increased state spending on health care. Suppose that college education is on the vertical axis and health care is on the horizontal axis of a PPF. These changes A) are example of a tradeoff.
B) are an example of incentives.
C) will cause a shift out of the PPF.
D) will cause a shift in the of the PPF.
Question 2
Goods and services that can be produced by using commonly available resources that could be allocated to a wide variety of alternative tasks have a supply that is
A) elastic.
B) inelastic.
C) unit elastic.
D) perfectly inelastic.
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