Which of the following statements about the production possibilities curve is the most accurate? O It is a curve that shows the quantity of output that will be offered for sale at various prices. It is a graph that shows the various combinations of output it is possible for an economy to produce given its available resources and technology. It is a graph that shows the combinations of output that are most profitable to produce. It is a graph that shows the various combinations of resources that can be used to produce a given level ofm output.

Which of the following statements about the production possibilities curve is the most accurate? O It is a curve that shows the quantity of output that will be offered for sale at various prices. It is a graph that shows the various combinations of output it is possible for an economy to produce given its available resources and technology. It is a graph that shows the combinations of output that are most profitable to produce. It is a graph that shows the various combinations of resources that can be used to produce a given level ofm output.

Economics Today and Tomorrow, Student Edition

1st Edition

ISBN:9780078747663

Author:McGraw-Hill

Publisher:McGraw-Hill

Chapter1: What Is Economics

Section: Chapter Questions

Problem 20AA

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Introduction to the Production Possibilities Curve (PPC) As you know, the basic economic problem is scarcity. Since we do not have enough scarce resources to satisfy everyone's needs and wants, we all have to make choices. We must choose how to spend our time, our energy, our money, and our material possessions, and for every choice that is made, a cost is suffered. The relationship between choice and cost can be shown in a graph called a production possibilities curve, or PPC. For example, consider a student who has 4 hours of free time in the evening. He or she can choose to spend some, all, or none of those 4 hours studying for a test the following day. He or she could also use the time to catch up on sleep. These choices can be graphed: Choice A - spend all 4 hours studying Choice B- spend 2 hours studying, and 2 hours getting extra sleep Choice C- spend all 4 hours sleeping Of course, other combinations of the 4 hours exist. The student could study for 3.5 hours, and get an extra…
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