An economist developing a production possibilities model of an economy operating at peak capacity at a specific point in time would assume:
A) resources are fully employed.
B) production technology is held constant.
C) the number of available resources is held constant.
D) all of the above.

Question

Quizplus · Accepted Answer

A production possibilities model assumes that resources are fully employed, production technology is constant, and the number of available resources is constant, to analyze the maximum output combinations an economy can produce.

An Economist Developing a Production Possibilities Model of an Economy