Answer to Question #41686 in Economics of Enterprise for litekiah green

Question

Auto Bull's-Eye offers a 10-minute oil change and 30-minute brake check. There are two technicians who perform each of these services. Next week, the shop is offering a discounted oil change. How might this affect the production possibilities curve for next week?

The shop would decrease the brake-check price to eliminate scarcity.

The shop would increase worker pay to make up for the opportunity cost of not doing brake checks.

The shop would shift production to oil changes and away from brake checks.

The shop would shift production to brake checks and away from oil changes.

Answer 1

If next week the shop is offering a discounted oil change, it would shift production to oil changes and away from brake checks, because there will be higher demand for change of oil.
So, the right answer is 3).