Question

If production possibility curve is a straight horizontal line it means _______.

• A. unlimited production of both the goods
• B. no production at all
• C. fixed production of one goods and unrestricted production of other
• D. none of the above

Answer 1

The correct option is C fixed production of one goods and unrestricted production of other

If production possibility curve is a straight horizontal line it means that the production of one good is fixed whereas the production of the other good is unrestricted. Thus it goes on increasing. this means that the resources are unlimited for one of the goods and are resources are fixed for one good.