Author Question: If Mexico is currently operating at a point inside its production possibilities frontier, then there ... (Read 80 times)

tatyanajohnson · **on:** Jun 29, 2018

If Mexico is currently operating at a point inside its production possibilities frontier, then there are unemployed resources in Mexico. Is this statement true or false? Briefly explain your answer.

What will be an ideal response?

Question 2

Patty spends 10 a week on bagels and soda. The price of a bagel is 2 and the price of soda is 1 a can. Patty buys 2 bagels and 6 cans of soda. Her marginal utility from bagels is 20 units.

The price of a bagel rises to 3 and the price of a can of soda rises to 1.50. Patty now buys ________ bagels and her marginal utility from bagels ________. She buys ________ cans of soda and her marginal utility from soda ________. A) fewer than 2; increases; fewer than 6; increases
B) 2; is 20 units; 6; is 10 units
C) fewer than 2; is 20 units; fewer than 6; is 10 units
D) fewer than 2; decreases; fewer than 6; decreases

JYan · **Reply #1 on:** Jun 29, 2018

Answer to Question 1

The statement is true. Points within the production possibilities frontier are attainable, so it is possible for Mexico to be producing at a point within its frontier. At points within the production possibilities frontier, there are unemployed resources.

Answer to Question 2

A