Suppose an economy produces two goods, food and machines. this economy always operates on its production possibilities frontier. last year, it produced 1000 units of food and 47 machines. this year it experienced a technological advance in its machine-making industry. as a result, this year the society wants to produce 1050 units of food and 47 machines. which of the following statements is correct?
a. because the technological advance occurred in the machine-making industry, it will not be possible to increase food production without reducing machine production below 47.
b. because the technological advance occurred in the machine-making industry, increases in output can only occur in the machine industry.
c. in order to increase food production in these circumstances without reducing machine production, the economy must reduce inefficiencies.
d. the technological advance reduced the amount of resources needed to produce 47 machines, so these resources could be used to produce more food.

Aprice ceiling is “binding” if the price ceiling is set below the equilibrium price. suppose that the equilibrium price is $5. if a price ceiling is set at $6, this will not affect the market in any way since $5 remains a legally allowable price (since $5 < $6). a price ceiling of $6 is called a “non-binding” price ceiling. on the other hand, if the price ceiling is set at $4, the price ceiling is “binding” because the natural equilibrium price is $5 but that is no longer allowed. what happens when there is a binding price ceiling? at a price below the equilibrium price, quantity demanded exceeds quantity supplied. there is a shortage. normally, price increases eliminate shortages by increasing quantity supplied and decreasing quantity demanded. in this case, however, price increases are not allowed past the price ceiling. we therefore predict that the observed market price will be right at the price ceiling and there will be a permanent shortage. the observed quantity bought and sold will be dictated by the quantity supplied at the price ceiling. although consumers would like to buy more, there are no more units for sale

Allie and sarah decided that they want to purchase renters insurance for the apartment they share. they made a list of all of the items to be covered by the insurance policy, along with their estimated values. if the items to be covered total more than $3000, the insurance company charges an annual premium of 23% of the total value of the items. if the items to be covered total $3000 or less, the insurance company charges an annual premium of 20% of the total value of the items.

Select all that apply. select the ways that labor unions can increase wages. collective bargaining reducing the labor supply increasing the demand for labor creating monopolies