Author Question: Production is efficient when A) it generates a point beyond the production possibility curve. B) ... (Read 117 times)

Pea0909berry · **on:** Jun 29, 2018

Production is efficient when

A) it generates a point beyond the production possibility curve.
B) the maximum output possible is being produced given current levels of resources and technology.
C) technological change occurs.
D) the maximum amounts of the most important good are produced.

Question 2

Which of the following correctly describes a way in which deficit spending can impose a burden on future generations? I.

Failure to allocate deficit spending to uses that boost future real Gross Domestic Product (GDP) will require taxing future generations at a higher rate to repay the resulting higher public debt. II. Government deficits that lead to higher employment and real Gross Domestic Product (GDP) in the future will generate increased income taxes for future governments, which will respond by spending the higher tax revenues, creating higher future government budget deficits. III. Other things being equal, deficit spending fuels increased consumption of goods and services by the current generation that crowds out capital investment, thereby leaving future generations with a smaller stock of capital than otherwise would have existed. A) I only
B) II only
C) I and III only
D) II and III only