On a diagram of a production possibilities boundary,the concept of choice is illustrated by the
A)negative slope of the boundary.
B)unattainable combinations outside the boundary.
C)need to select among the alternative attainable points along or inside the boundary.
D)the concave shape of the boundary.
E)the distance from the origin to the boundary.

Question

Quizplus · Accepted Answer

A production possibilities boundary represents the combination of goods and services that can be produced with limited resources. To produce one good or service, resources must be diverted from producing another good or service. Therefore, the boundary represents a tradeoff between the two goods or services. The concept of choice is illustrated on the diagram by the need to select among the attainable points along or inside the boundary. These attainable points represent different ways to allocate the limited resources, and the choice of which combination of goods and services to produce depends on the preferences and priorities of individuals, firms, and society as a whole.

On a Diagram of a Production Possibilities Boundary,the Concept of Choice