A small economy produces only pizzas and jeans.If resources are used inefficiently in the economy,
A)it will be possible to produce more pizzas without decreasing the production of jeans.
B)the economy will be operating at a point on its production possibilities curve.
C)the economy will be operating at a point outside its production possibilities curve.
D)it will not be possible to produce more jeans or pizzas.

Question

Quizplus · Accepted Answer

When resources are used inefficiently, the economy operates inside its production possibilities curve, meaning it can increase production of one good without reducing the production of another.

A Small Economy Produces Only Pizzas and Jeans