Suppose the economy goes from a point on its production possibilities frontier (PPF)to a point below that PPF.Assuming that the PPF has not shifted,this could be due to
A)a gain of resources.
B)a loss of resources.
C)technological improvement in the production of both goods.
D)a new law that interferes with economic efficiency.

Question

Quizplus · Accepted Answer

A new law that interferes with economic efficiency could cause the economy to operate below its PPF, as it may prevent the optimal use of resources, leading to underutilization.

Suppose the Economy Goes from a Point on Its Production