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A production possibility curve shows?


Question

A production possibility curve shows?

Options

A)
how much of the resources of society are used to produce a particular commodity
B)
the rate of inflation
C)
the rate of unemployment in the economy
D)
the various combinations of two commodities that can be produced

The correct answer is D.

Explanation:

The production possibility frontier (PPF) is a curve depicting all maximum output possibilities for two goods, given a set of inputs consisting of resources and other factors. The PPF assumes that all inputs are used efficiently.

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  • The production possibility frontier (PPF) is a curve depicting all maximum output possibilities for two goods, given a set of inputs consisting of resources and other factors. The PPF assumes that all inputs are used efficiently.

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