The Production Possibilities Curve is a device designed to demonstrate what principle?
A) the existence of trade-offs.
B) the effect of consumer demand on prices.
C) the effect of unlimited resources on production decisions.
D) that there are no limits to production possibilities.

Question

Quizplus · Accepted Answer

The Production Possibilities Curve shows the maximum combinations of two goods that can be produced with given resources and technology. This demonstrates the principle of trade-offs as producing more of one good means producing less of another good.

The Production Possibilities Curve Is a Device Designed to Demonstrate