Statement I: In the modern global economy,if our steel industry were operating at full capacity we could easily get steel from other steel-producing countries.
Statement II: The only constraints on our production possibilities frontier are physical constraints such as the number of steel factories available,etc.
A)Statement I is true and statement II is false.
B)Statement II is true and statement I is false.
C)Both statements are true.
D)Both statements are false.

Question

Quizplus · Accepted Answer

Statement I is true as there are many steel-producing countries in the modern global economy which can supply steel. However, statement II is false as the production possibilities frontier is also constrained by non-physical factors such as technology, knowledge, and institutions. Therefore, both physical and non-physical constraints limit the production possibilities frontier.

Statement I: in the Modern Global Economy,if Our Steel Industry