A point lying inside (under) a production possibilities curve indicates that
A)the economy is saving money.
B)there are no associated opportunity costs.
C)more output could be produced with existing resources.
D)technology limits production.

Question

Quizplus · Accepted Answer

A point inside the production possibilities curve means that the economy is not fully utilizing all its resources and can produce more output with the existing resources. Therefore, there are no associated opportunity costs, and technology is not limiting production. The economy can produce more without sacrificing the production of other goods. It does not necessarily indicate that the economy is saving money, as it may not be producing at full capacity.

A Point Lying Inside (Under) a Production Possibilities Curve Indicates