-In the figure above, suppose that Mac and Izzie trade and reach point c. Then
A) Izzie produces outside her production possibilities frontier.
B) Mac produces outside his production possibilities frontier.
C) neither Mac nor Izzie produce outside their production possibilities frontiers.
D) Mac and Izzie both produce outside their production possibilities frontiers.

Question

-In the figure above, suppose that Mac and Izzie trade and reach point c. Then
A) Izzie produces outside her production possibilities frontier. 
B) Mac produces outside his production possibilities frontier. 
C) neither Mac nor Izzie produce outside their production possibilities frontiers. 
D) Mac and Izzie both produce outside their production possibilities frontiers.

Quizplus · Accepted Answer

When Mac and Izzie trade and reach point c, they are able to consume at a point that may be outside their individual production possibilities frontiers, but they do not produce outside their frontiers. Trade allows them to specialize and consume more than they could produce on their own.

-In the Figure Above, Suppose That Mac and Izzie Trade