When can a country's consumption possibilities frontier be outside its production possibilities frontier?
A)If additional resources become available.
B)If there is an increase in the level of technology.
C)If the country engages in trade.
D)If resources are shiftable.

Question

Quizplus · Accepted Answer

When a country engages in trade, it can obtain goods and services that it cannot produce domestically, allowing it to consume outside of its own production possibilities frontier. This is because by trading, the country can obtain goods and services from other countries that it cannot produce itself, thus expanding its consumption possibilities.

When Can a Country's Consumption Possibilities Frontier Be Outside Its