The production possibilities frontier:

Question

Quizplus · Accepted Answer

The production possibilities frontier (PPF) can show all possible combinations of goods that can be produced with a given level of resources and technology. However, the PPF does not provide any guidance on which combination of goods is the best for society. The choice of the best combination depends on the society's preferences and priorities, which are not captured in the PPF. Therefore, A is the best choice. B is incorrect because the PPF does not tell us which combination is the best. C is incorrect because the PPF assumes that the society is producing at the most efficient level, so all possible combinations are shown. D is incorrect because the PPF can also show the inefficient points on the graph (i.e. points inside the curve).

The Production Possibilities Frontier