A recession can be represented by a point
A)Inside the production possibilities curve.
B)Outside the production possibilities curve.
C)On the production possibilities curve.
D)At either end of the production possibilities curve.

Question

Quizplus · Accepted Answer

A recession represents a decrease in overall economic activity, which means that the economy is producing less than it is capable of producing. This would place it inside the production possibilities curve, indicating a decrease in resources or efficiency. B would be incorrect as it represents an increase in economic activity beyond what is possible, while C and D would suggest no change in economic activity.

A Recession Can Be Represented by a Point