The production possibilities curve represents
A) the total amount of stocks and bonds that exist in the economy.
B) the trade-off between human capital and physical capital that exists.
C) all possible combinations of total output that can be produced.
D) society's needs.

Question

Quizplus · Accepted Answer

The production possibilities curve is a graphical representation of all possible combinations of two goods that can be produced with given resources and technology. Therefore, option C is the correct choice as it represents all possible combinations of total output that can be produced. Option A is incorrect as it refers to a specific type of financial assets and is not related to production. Option B is incorrect as it refers to the allocation of resources between two specific types of capital and is not a general representation of production possibilities. Option D is incorrect as it is too broad and does not provide a specific answer.

The Production Possibilities Curve Represents