QuestionAugust 3, 2025

3. The production possibilities frontier represents: A. The limit of an economy's production capabilities. B. Full employment. C. The resources available for producing goods and services. D. All of the above.

3. The production possibilities frontier represents: A. The limit of an economy's production capabilities. B. Full employment. C. The resources available for producing goods and services. D. All of the above.
3. The production possibilities frontier represents: A. The limit of an economy's production capabilities. B. Full employment. C. The resources available for producing goods and services. D. All of the above.

Solution
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Answer

D. All of the above. Explanation 1. Identify the definition of Production Possibilities Frontier (PPF) The PPF represents the maximum possible output combinations of two goods or services an economy can achieve when all resources are fully and efficiently utilized. 2. Analyze each option A. Correct, as it shows the limit of production capabilities. B. Correct, as it assumes full employment of resources. C. Correct, as it involves available resources for production. 3. Determine if multiple options apply Since A, B, and C are correct, D ("All of the above") is the most comprehensive answer.

Explanation

1. Identify the definition of Production Possibilities Frontier (PPF)<br /> The PPF represents the maximum possible output combinations of two goods or services an economy can achieve when all resources are fully and efficiently utilized.<br /><br />2. Analyze each option<br /> A. Correct, as it shows the limit of production capabilities.<br /> B. Correct, as it assumes full employment of resources.<br /> C. Correct, as it involves available resources for production.<br /><br />3. Determine if multiple options apply<br /> Since A, B, and C are correct, D ("All of the above") is the most comprehensive answer.
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