If an economy is operating on its production possibilities frontier (PPF),are there any unemployed resources in the economy?
A) Yes, because if there weren't any unemployed resources the economy would be producing beyond its PPF.
B) No, because if there were any unemployed resources the economy would be producing below its PPF.
C) It depends on whether the economy's PPF is a concave (downward-sloping) curve or a straight line.
D) Yes, because there are always some natural resources that are unemployed.
E) The answer is "yes," but not for any of the reasons specified in answers a through d.

Question

Quizplus · Accepted Answer

If an economy is operating on its PPF, it is already producing at the maximum possible output given its available resources and technology. Therefore, there are no unemployed resources in the economy. If there were any unemployed resources, the economy would be producing below its PPF.

If an Economy Is Operating on Its Production Possibilities Frontier