Choosing to Produce at Any Point Within a Production Possibilities

question 13

Multiple Choice

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

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

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Definitions:

Additional Cost

The increase in total cost that arises from an increase in the level of output by one unit; also known as marginal cost.

Relative Price Of Oil

The price of oil compared to other goods and services, indicating how much of other goods/services one can trade for a unit of oil.

Run Out Of Oil

A scenario where the global supply of petroleum, a non-renewable resource, is significantly depleted or exhausted.

Alternative Energy Sources

Energy sources that are renewable and have a lower environmental impact compared to fossil fuels, such as solar, wind, and hydroelectric power.