Final answer:
To choose between points B and C on the production possibilities frontier (PPF) in EOC 2.03, one would use rational decision-making based on weighing the costs and benefits. The PPF represents the maximum combination of goods that an economy can produce given its available resources and technology.
Step-by-step explanation:
In order to choose between points B and C on the production possibilities frontier (PPF) in EOC 2.03, one would use rational decision-making. This means that the decision would be based on weighing the costs and benefits of each option. In this case, we know that convertibles are valued three times as much as sedans. Therefore, if the benefit of choosing a convertible outweighs the cost compared to choosing a sedan, one would choose point B. However, if the cost of choosing a convertible outweighs the benefit, one would choose point C.
The production possibilities frontier (PPF) represents the maximum combination of goods that an economy can produce given its available resources and technology. It shows the trade-offs between different goods that an economy must make when allocating its resources. When a point is on the PPF, it represents productive efficiency because it indicates that all available resources are being fully utilized to produce the maximum possible output of both goods. Any point inside the PPF would indicate inefficiency, as resources are not fully utilized. The PPF also shows the concept of opportunity cost, as to produce more of one good, the economy must give up some of the other good.