When a country is producing goods and services efficiently it:
A) is producing at a point on or below its production possibilities frontier.
B) is getting the most output by using all its available resources.
C) has unemployed workers.
D) is able to reach a point beyond its production possibilities frontier.

Question

Quizplus · Accepted Answer

When a country is producing goods and services efficiently, it means that it is using all its available resources to produce the maximum output possible. This implies that the economy is operating at a point on its production possibilities frontier (PPF) or on the frontier itself. This is because the PPF shows the combinations of goods and services that an economy can produce when it is using all its resources efficiently. Consequently, options A and D are incorrect. Also, if an economy is producing efficiently, it means that there are no unemployed resources in the economy, including workers. Therefore option C is also incorrect.

When a Country Is Producing Goods and Services Efficiently It