A graph that illustrates the maximum amount of one good that can be produced for every possible level of production of the other good is termed a(n)
A) production possibilities curve.
B) consumption possibilities curve.
C) production impossibilities curve.
D) comparative advantage curve.
E) absolute advantage curvE.

Question

Quizplus · Accepted Answer

A production possibilities curve (PPC) is a graphical representation of the maximum amount or combinations of two goods that can be produced with the given resources and technology. It shows the tradeoffs between producing one good over another and illustrates the concept of opportunity cost. Therefore, the correct option is A) production possibilities curve.

A Graph That Illustrates the Maximum Amount of One Good