Use the following to answer questions :
Figure: Production Possibility Frontier
-(Figure: Production Possibility Frontier) Look at the figure Production Possibilities Frontier. If the economy is producing 8 cars and 12 computers per period:
A)unemployment or inefficiency will ensue.
B)the notion of increasing opportunity cost is invalidated.
C)the economy is still efficient but has made a decision not to buy as much as it could.
D)something must be done to reduce the amount of employment.

Question

Use the following to answer questions :
Figure: Production Possibility Frontier 
-(Figure: Production Possibility Frontier) Look at the figure Production Possibilities Frontier. If the economy is producing 8 cars and 12 computers per period:
A)unemployment or inefficiency will ensue. 
B)the notion of increasing opportunity cost is invalidated. 
C)the economy is still efficient but has made a decision not to buy as much as it could. 
D)something must be done to reduce the amount of employment.

Quizplus · Accepted Answer

If the economy is producing inside the production possibility frontier, it indicates that resources are not being used efficiently, leading to unemployment or inefficiency.

Use the Following to Answer Questions