A point inside, or to the left of, a production possibilities curve indicates that:
A) the economy is growing.
B) the economy is operating at full employment.
C) some of the economy's resources are unemployed.
D) more of one good can be produced only by giving up some of another good.

Question

Quizplus · Accepted Answer

A point inside or to the left of a production possibilities curve indicates that not all resources are being used efficiently; in other words, some of the economy's resources are unemployed. This is because the production possibilities curve represents the maximum possible output an economy can produce when all resources are fully employed.

A Point Inside, or to the Left Of, a Production