A curve that shows the various combinations of goods and services that are possible for an economy to produce with a given amount of resources is referred to as a(n)________.
A) supply curve
B) indifference curve
C) budget constraint
D) production possibilities curve

Question

Quizplus · Accepted Answer

A production possibilities curve shows the maximum possible combinations of goods or services that an economy can produce with a given amount of resources. Therefore, D is the correct answer. A supply curve shows the quantity of a product that producers are willing and able to sell at different prices, an indifference curve shows the level of satisfaction or utility that a consumer gets from different combinations of goods or services, and a budget constraint shows the the different combinations of goods and services that a consumer can afford given their income and prices of goods.

A Curve That Shows the Various Combinations of Goods and Services