Use the figure below to answer the following questions.

Figure 2.1.1
-Refer to the production possibilities frontier in Figure 2.1.1. Which one of the following is true about point A?
A)It is unattainable.
B)While no more of good Y can be produced, more of good X can be produced.
C)It is preferred to point B.
D)Resources are either unused or misallocated or both.
E)It is attainable only if the amount of capital goods is increased.

Question

Use the figure below to answer the following questions.
  
Figure 2.1.1
-Refer to the production possibilities frontier in Figure 2.1.1. Which one of the following is true about point A?
A)It is unattainable. 
B)While no more of good Y can be produced, more of good X can be produced. 
C)It is preferred to point B. 
D)Resources are either unused or misallocated or both. 
E)It is attainable only if the amount of capital goods is increased.

Quizplus · Accepted Answer

Point A is inside the production possibilities frontier, indicating that resources are not being used efficiently or are misallocated.

Use the Figure Below to Answer the Following Questions