The production possibilities frontier illustrates

Question

Quizplus · Accepted Answer

The production possibilities frontier illustrates all of the options mentioned in the answer choices. It demonstrates the fundamental fact of scarcity by showing that there are limited resources available to produce goods and services. It also shows the opportunity cost of acquiring more of one good by demonstrating that to produce more of one good, an economy must give up some production of another good. Finally, it illustrates maximum output utilizing all resources efficiently by showing the optimal combinations of goods that an economy can produce given its resources and technology.

The Production Possibilities Frontier Illustrates