The production possibilities frontier
A) shows how many goods and services are consumed by each person in a country.
B) is a model that assumes there is no scarcity and no opportunity cost.
C) is a graph with price on the vertical axis and income on the horizontal axis.
D) depicts the boundary between those combinations of goods and services that can be produced and those that cannot, given resources and the current state of technology.

Question

Quizplus · Accepted Answer

The production possibilities frontier (PPF) illustrates the maximum output combinations of two goods or services an economy can achieve when all resources are fully and efficiently utilized, given the current state of technology. It highlights the trade-offs and opportunity costs associated with allocating resources between the production of different goods or services.

The Production Possibilities Frontier