Question

How does the utility possibilities frontier relate to the contract​ curve? A. Every point along the contract curve appears on the utility possibilities frontier showing the extent to which it is efficient. B. The points along the contract curve that are attainable appear on the utility possibilities frontier showing the levels of satisfaction for consumers. C. Every point along the contract curve appears on the utility possibilities frontier showing the​ well-being of society as a whole. D. The points along the contract curve that are feasible appear on the utility possibilities frontier showing the combinations of two goods that can be produced with fixed quantities of inputs. E. Every point along the contract curve appears on the utility possibilities frontier showing the levels of utility for consumers.

Answer 1

Answer:

a. every point along the contract curve appears on the utility possibilities frontier showing the levels of utility for consumers

Explanation:

the contract curve is the set of tangency points between the indifference curves of the two consumers. It is termed the contract curve since the outcome of negotiation about trade between two consumers should result in an agreement  that has an outcome on the contract curve.