Q2 of 25 Page 1

Shift from Point A on Production Possibility Curve X11Y1to Point B on X2Y2in the given figure indicates : (Choose the correct alternative)


An outward shift in a possibility curve denotes that the economy of a nation has increased its capacity to produce.


OR


A Production Possibility Curve (PPC) would be convex to the origin if


Marginal Rate of Transformation (MRT) is ___decreasing_____ . PPC represents the number of goods that can be obtained by estimating the number of goods in terms of another.

More from this chapter

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1

The shape of the average revenue curve under perfect competition would be ______Horizontal line__ _. (Fill up the blank)

 3

Mention any two examples of the implicit cost incurred by a firm.

OR


Define variable cost.


 4

The coefficient of price elasticity of supply of a good is 3. It is known as

__________ . (Choose the correct alternative)


 5

Discuss briefly the central problem of ‘‘How to produce’’.

OR


Classify the following statements into positive economics or normative economics, with suitable reasons :


(a) The autonomy of the central bank of a country should be maintained as per the law.


(b) Nominal Gross Domestic Product (GDP) is calculated based on ‘current year prices'.