Figure 2-2 Consider the production possibilities curve for a country that can produce cars,corn (in bushels),or a combination of the two.
-Refer to Figure 2-2.If this economy devotes all of its available resources to producing corn,then it will produce

Question

Figure 2-2  Consider the production possibilities curve for a country that can produce cars,corn (in bushels),or a combination of the two.
-Refer to Figure 2-2.If this economy devotes all of its available resources to producing corn,then it will produce

Quizplus · Accepted Answer

When an economy devotes all of its resources to producing one good, it operates at its maximum capacity of that good. In this case, if the country devotes all of its resources to producing corn, it will produce 160 bushels of corn (point A on the production possibilities curve) and 0 cars. This is the point on the curve that represents the maximum possible production of corn with the given resources.

Figure 2-2 Consider the Production Possibilities Curve for a Country