Author Question: In the case of leisure, the substitution effect implies that: A) when the price of leisure ... (Read 119 times)

ap345 · **on:** Jun 29, 2018

In the case of leisure, the substitution effect implies that:

A) when the price of leisure increases, people will work more.
B) when the price of leisure increases, people will work less and relax more.
C) if people tend to work more and relax less, the price of leisure increases.
D) if people tend to work more and relax less, the price of leisure decreases.

Question 2

The bowed outward shape of the production possibilities frontier in the above figure indicates that

A) some resources are better suited for producing computers.
B) the opportunity cost of producing more computers decreases as more computers are produced.
C) computer technology is subject to the principle of decreasing costs.
D) All of the above answers are correct.