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In the Two­sector (Manufacturing and Agriculture)

Question 36

Multiple Choice

In the two­sector (manufacturing and agriculture)
Specific­factors model, diminishing returns to labor
Implies:


A) that the country's production possibilities frontier is linear (a straight line) .
B) that the country's production possibilities frontier is concave to the origin (bowed out from the origin) .
C) that the country's production possibilities frontier is convex from the origin (bowed in toward the origin) .
D) that the country's production possibilities frontier may be either concave to or convex from the origin.

Correct Answer:

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