The figure given below shows the production possibilities frontier for mufflers and socks. If society moves from point c to point d, then society:
Figure 2.4

Question

The figure given below shows the production possibilities frontier for mufflers and socks. If society moves from point c to point d, then society:​ ​
Figure 2.4

Quizplus · Accepted Answer

Moving from point c to point d involves a shift in resources from muffler production to sock production. As a result, the society loses 30 mufflers but gains no socks, so option A is incorrect. Society is not worse off after the change because it still has access to the same production possibilities, just different amounts of each product, so option C is incorrect. There is no information in the diagram to suggest that the society is not operating efficiently, so option D is incorrect. Finally, there is no indication of unemployment of resources in the diagram, so option E is incorrect.

The Figure Given Below Shows the Production Possibilities Frontier for Mufflers