When an economy is operating efficiently, the production of more of one good will result in the production of less of some other good because
A) consumers do not want more of both goods.
B) resources are limited (scarce) and efficiency implies that all are already in use.
C) the production possibilities curve shifts inward as more of one good is produced.
D) technological improvement can only improve the production of a single good.

Question

Quizplus · Accepted Answer

When an economy is operating efficiently, it is already using all available resources (land, labor, capital) in the most productive way possible. Therefore, producing more of one good would require diverting resources away from the production of another good, resulting in a decrease in its production. This is because resources are limited (scarce) and cannot be used for the production of more than one good at a time.

When an Economy Is Operating Efficiently, the Production of More