The production possibilities curve shows
A) the various combinations of two goods that can be produced when society employs all of its scarce resources.
B) the minimum outputs of two goods that will sustain a society.
C) the various combinations of two goods that can be produced when some resources are unemployed.
D) the ideal, but unattainable, combinations of two goods that would maximize consumer satisfaction.

Question

Quizplus · Accepted Answer

The production possibilities curve shows the different combinations of two goods that can be produced when all available resources are fully employed. It represents the different trade-offs that a society needs to make when choosing how to allocate its scarce resources between two different products. The curve shows the maximum output of one good that can be produced for every possible output of the other good.

The Production Possibilities Curve Shows