Principles of Microeconomics, 7th Edition

Published by South-Western College
ISBN 10: 128516590X
ISBN 13: 978-1-28516-590-5

Chapter 2 - Part I - Thinking Like an Economist - Quick Check Multiple Choice: 3

Answer

b. feasible, but not efficient

Work Step by Step

The production possibilities frontier is a graph that shows the various combinations of two outputs that an economy can produce given the available factors of production and technology. The curve represents all of the combinations of output that an economy can produce if it uses all of its scarce resources efficiently, and the curve implies that the economy faces a tradeoff in that it must decrease the production of one good in order to increase the production of another. Therefore, a point inside the curve means that the economy is capable of using its resources more efficiently to produce more of one good while not having to decrease production of the other good.
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