Question

6. What is the production possibilities frontier?

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the points on a production possibilities graph that show an underutilization of resources
the line on a production possibilities graph that shows how production increases as new technologies are introduced
the points on a production possibilities graph that show the total revenue of an economy
the line on a production possibilities graph that shows the maximum possible output

Answer 1

A production possibilities frontier (PPF) is a line on a graph that shows the maximum possible output that can be produced within an economy. It represents the set of choices society faces for the combinations of goods and services it can produce given the resources and technology available.

Step-by-step explanation:

A production possibilities frontier (PPF) defines the set of choices society faces for the combinations of goods and services it can produce given the resources and technology available. It is a line on a graph that shows the maximum possible output that can be produced within an economy. The shape of the PPF is typically curved outward, indicating that as more of one good is produced, the opportunity cost of producing another good increases.