Asked by
Jayson Blacklock
on Nov 12, 2024
Verified
The production possibilities curve of a country will be a straight line if _____.
A) the production of each commodity is subject to economies of scale
B) the country completely specializes in the production of the good with the highest opportunity cost
C) the country has an absolute advantage in the production of each commodity
D) the resources in the country are equally adaptable to the production of each commodity
E) the country completely specializes in the production of the good with the lowest opportunity cost
Production Possibilities Curve
A graphical representation that shows the various combinations of two products that an economy can produce using all its resources efficiently.
Economies of Scale
Cost advantages reaped by companies when production becomes efficient, due to the scale of operation increasing.
Opportunity Cost
The abandonment of potential improvements from other possibilities once one choice is made.
- Understand the shape and implications of the production possibilities curve.
Verified Answer
GB
Learning Objectives
- Understand the shape and implications of the production possibilities curve.