Consider a society that is producing inside its production possibilities frontier.This society could best achieve efficiency in its production of output by:
A) distributing incomes more equally.
B) fully employing all available resources.
C) increasing the levels of wages and prices.
D) producing relatively more capital goods and relatively fewer consumer goods.

Question

Quizplus · Accepted Answer

Producing inside the production possibilities frontier means the society is not utilizing all available resources. In order to achieve efficiency in production, the society should fully employ all available resources. This would allow for the maximum production possible given the resources available. Redistributing incomes, increasing wages and prices, or changing the composition of goods produced would not necessarily result in increased efficiency.

Consider a Society That Is Producing Inside Its Production Possibilities