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
Related Lesson: Indifference Curve | Theory of Consumer Behaviour
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.