While producing on the production possibilities frontier, if ...

[LaDunn]

While producing on the production possibilities frontier, if additional units of a good could be produced at a constant opportunity cost, the production possibilities frontier would be
 
  A) bowed outward.
  B) bowed inward.
  C) positively sloped.
  D) a straight line.

Question 2

Suppose a deposit in New York earns 6 percent a year and a deposit in London earns 4 percent a year. Interest rate parity holds if the
 
  A) U.S. dollar appreciates by 2 percent a year.
  B) U.S. dollar depreciates by 2 percent a year.
  C) U.K. pound depreciates by 2 percent a year.
  D) None of the above answers is correct because interest rate parity requires that the interest rates be the same in both countries.

[LVPMS]

Answer to Question 1

D

Answer to Question 2

B

[LaDunn]

TYSM

[Mochi]

Excellent