Economics 9708 · AS & A Level · Scarcity, choice and opportunity cost

Scarcity, choice and opportunity cost — practice question

The graph illustrates the total economic welfare gained by citizens from a government’s spending on health and education services. If the government has $60$ billion from its budget to divide between health and education services, which distribution will produce the greatest level of welfare for its citizens?

  • AHealth spending $0$ ($\$ billions), education spending $60$ ($\$ billions)
  • BHealth spending $20$ ($\$ billions), education spending $40$ ($\$ billions)
  • CHealth spending $40$ ($\$ billions), education spending $20$ ($\$ billions)
  • DHealth spending $60$ ($\$ billions), education spending $0$ ($\$ billions)

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