A country's production possibilities boundary shows that when a society uses its resources efficiently,
A)it cannot produce more of one good without producing less of the other good.
B)it can produce more of only one good.
C)it is always possible to produce more of all goods.
D)all points inside the boundary are preferred to all points on the boundary.
E)the supply for goods always exceeds the demand.

Question

Quizplus · Accepted Answer

The production possibilities boundary (PPB) represents the maximum combination of two goods that a society can produce with its resources and technology. Any point inside the PPB represents inefficient use of resources, while any point outside the PPB is unattainable. When a society uses its resources efficiently and operates on the PPB, it means it is producing the maximum amount of one good given the production level of the other good. Thus, it cannot produce more of one good without producing less of the other good, which is represented by the downward slope of the PPB.

A Country's Production Possibilities Boundary Shows That When a Society