A point inside a production possibilities frontier
A) could indicate that resources are misallocated.
B) reflects the fact that more technology needs to be developed to fully employ all resources.
C) is more efficient than a point on the production possibilities frontier.
D) implies that too much labor and not enough capital is being used.

Question

Quizplus · Accepted Answer

A point inside the production possibilities frontier indicates that resources are not being fully utilized or are misallocated. It represents a situation where the economy is not producing at its maximum potential given the available resources.

A Point Inside a Production Possibilities Frontier