The production possibilities curve is:
A)a graph that shows the combinations of output which are most profitable to produce.
B)a graph that shows the various combinations of output it is possible for an economy to produce given its available resources and technology.
C)a graph that shows the various combinations of resources that can be used to produce a given level of output.
D)a curve that shows the quantity of output that will be offered for sale at various prices.

Question

The production possibilities curve is:
A)​a graph that shows the combinations of output which are most profitable to produce.
B)​a graph that shows the various combinations of output it is possible for an economy to produce given its available resources and technology.
C)​a graph that shows the various combinations of resources that can be used to produce a given level of output.
D)​a curve that shows the quantity of output that will be offered for sale at various prices.

Quizplus · Accepted Answer

The production possibilities curve shows the different possible combinations of goods and services an economy can produce given its available resources and technology. It illustrates the trade-offs that must be made when allocating resources to the production of different goods and services. It is not primarily concerned with profitability, resources used, or prices.

The Production Possibilities Curve Is