Given an initial endowment of factor inputs
A)There is only one efficient level of outputs
B)There are many efficient levels of outputs
C)All the outcomes must be efficient
D)All the outcomes must be equitable

Question

Quizplus · Accepted Answer

The initial endowment of factor inputs can be used in many different combinations to produce multiple efficient levels of outputs. This is due to the concept of production possibility frontier, where various combinations of inputs can lead to the production of different levels of outputs, all of which are efficient given the available resources. Therefore, option B is the correct choice. Options A, C, and D are incorrect as there is not just one efficient level of output, not all the outcomes must be efficient, and not all the outcomes must be equitable.

Given an Initial Endowment of Factor Inputs