Production efficiency occurs
A)anywhere inside or on the production possibilities frontier.
B)when the total cost of production is minimised.
C)at only one point on the production possibilities frontier.
D)at all points inside the production possibilities frontier.
E)at all points on the production possibilities frontier.

Question

Quizplus · Accepted Answer

Production efficiency occurs at all points on the production possibilities frontier, where all resources are fully utilized and there is no waste in production. Points inside the frontier imply underutilization of resources, while points outside the frontier are unattainable with the given resources and technology. Therefore, only points on the frontier represent optimal production efficiency.

Production Efficiency Occurs