A graph that shows the maximum attainable combinations of two goods when society efficiently uses its productive resources is called
A) a production possibilities frontier (PPF).
B) a supply curve.
C) opportunity cost.
D) a consumer demand curve.
E) absolute advantage.

Question

Quizplus · Accepted Answer

A production possibilities frontier (PPF) shows the maximum attainable combinations of two goods when society efficiently uses its productive resources. Option B (a supply curve) only shows the relationship between price and quantity supplied of a particular good. Option C (opportunity cost) is a concept that refers to the cost of a chosen alternative. Option D (a consumer demand curve) shows the relationship between price and quantity demanded of a particular good. Option E (absolute advantage) refers to the ability of a country to produce a good using fewer inputs than another country.

A Graph That Shows the Maximum Attainable Combinations of Two