A production possibility curve presents valuable information about production. Which of the following statements describes the information best?

The maximum output of any two products that can be produced with given resources.

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The rise and fall of total output when resources and technologies are fixed.

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The production pattern in an economy when resources and techniques are fixed.

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The growth of production over a period of time with given resources.

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Solution

The correct option is A The maximum output of any two products that can be produced with given resources.
Production possibility curve shows all different attainable combinations of the production of two commodities that can be produced at the maximum in an economy with given the scarce resources and technology which are to be fully utilized.

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Similar questions

Which of the following is an assumption of Production Possibility Frontier?

i) Resources are not fully employed.

ii) Resources are not equally efficient for production of the two goods.

iii) Resources are not efficiently employed.

iv) Resources available are not fixed.

Which of the following is an assumption of Production Possibility Frontier?
(i) Resources are not fully employed.
(ii) Resources are not equally efficient for production of the two goods.
(iii) Resources are not efficiently employed.
(iv) Resources available are not fixed.

Q. Draw a production possibility curve and indicate growth of resources.

Increase (growth) of resources implies that production possibility curve ____________.

Q. Draw a transformation curve, given the following possibilities of production (resources and technology remains constant). Also, find the marginal opportunity cost when more and more guns are produced in place of bread.

Guns(Units)	0	1	2	3	4	5
Bread (Units)	30	28	24	18	10	0

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