When all of the available factors of production are being efficiently employed,the
A) economy is producing at a point within its PPF.
B) economy is producing at a point on its PPF.
C) economy is producing at a point beyond its PPF.
D) PPF disappears.
E) opportunity cost of changing production is infinite.

Question

Quizplus · Accepted Answer

Production at a point on the PPF indicates efficient use of all factors of production. At any point inside the PPF, there is idle capacity or underutilization of resources. At any point beyond the PPF, there is a shortage of resources or technology, which can result in inefficiencies and wastage. Therefore, the economy is considered to be operating efficiently when it produces at a point on its PPF.

When All of the Available Factors of Production Are Being