Which of the following is NOT an assumption that economists make when developing a production possibilities frontier (PPF)?
A) We live in a world with only two goods.
B) There are no increases in technology.
C) There is no change in available resources.
D) Society will always be producing somewhere on the PPF.
E) There are no decreases in technology.

Question

Quizplus · Accepted Answer

The assumption that society will always be producing somewhere on the PPF is not accurate. The PPF represents potential production levels if resources are fully and efficiently utilized. In reality, economies often operate inside the PPF due to factors like unemployment or inefficiency, not always on it.

Which of the Following Is NOT an Assumption That Economists