Choosing to Produce at Any Point Within a Production Possibilities

question 76

Multiple Choice

Choosing to produce at any point within a production possibilities frontier:

• A)is inefficient,meaning the society would not be using all its available resources in their best possible use.
• B)is efficient,meaning the society would be using all its available resources in their best possible use.
• C)is unobtainable,meaning the society cannot produce that combination of goods.
• D)is efficient,meaning the society would be using all its available resources,though not in their best use.

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Definitions:

Utility Function

A mathematical representation in economics that describes how the satisfaction or utility a consumer derives varies with consumption of goods or services.

Compensating Variation

An economic concept referring to the amount of additional income required to keep an individual at the same level of utility after a price change.

Price of Earrings

The cost at which earrings are sold, which may vary based on materials, design, and brand.

Income

The amount of money or assets received over a period of time, typically through work, investments, or business operations.