answer choices . Or the marginal cost of an extra berry is 1/20 of a rabbit. 20) 21)Production points inside the production possibilities frontier A)are associated with unused or misallocated resources. D) an infinite opportunity cost. The point on the PPC where the economy operates depends on how well the resources are utilised. The opportunity cost of 20 more berries is 1 rabbit, but if you assume that this is somewhat linear right over here-- it's not so curved, it's somewhat of a line between those 2 points-- then the opportunity cost of 1 berry is 1/20 of a rabbit. A production possibility curve (PPC) shows the different combinationstyles of output of TWO goods that an economy can produce considering the factor of production and technology to be constant. Tags: Question 12 . b. unfeasible point. Learn vocabulary, terms, and more with flashcards, games, and other study tools. This means that the output of product A can only increase if the output of product B decreases. ... you have to note that you cannot operate at a point beyond the PPC curve. The Production Possibilities Curve (PPC) is a model used to show the tradeoffs associated with allocating resources between the production of two goods. C. Represents more resources than are currently available. ANS: c. While operating within the boundaries of the production possibilities curve, more of both goods can be attained if efficiency is improved. A Nash equilibrium occurs when: A. When all these points of different combinations of production of the two goods are joined, they form a Production Possibility Curve. 7. A point beneath the curve indicates inefficiency, and a point beyond the curve indicates impossibility. One or more resources (Land, labor, or capital) is being waisted or not used to its potential. 7. b) attainable but not efficient. 5. C. While operating within the boundaries of the production possibilities curve, more of both goods can be attained if efficiency is improved. D)any point on either the horizontal or the vertical axis. Any point below the curve represents a production level that isn’t using 100 percent of the company’s resources. The winding number will be $1$ inside a simple closed curve and zero outside. d. maximum output combination. E) a tradeoff. The points inside the production possibility curve (ppc) are points that indicate inefficient use of the available resouces.and the production technology. c. inefficient point. 86. unemployed resources in the country is shown by a point under the PPC … In macroeconomics, points inside the curve are used to illustrate a recession. it has to be on the cure or below the curve. B. attainable, but the economy is inefficient. 7. C. unattainable, but the economy is inefficient. C)are unattainable. Concepts covered include efficiency, inefficiency, economic growth and contraction, and recession. By definition all point to the right or outside of the production possibility curve (frontier) are impossible, given the limits of resources and technology. Qn 3. A point that lies outside a country's production possibilities curve means that the country is not able to produce. D. Is attainable if all resources are used efficiently. The production possibilities curve is a vital economic concept for the AP® Microeconomics and AP® Macroeconomics exams. If you have a well-behaved simple closed curve imagine a line (ray i.e. The possibility curve shows how a country can efficiently produce. 16) A movement from a point inside the production possibilities frontier to a point on the production possibilities frontier represents 16) A) full employment of labor but not capital. A point inside the production possibilities curve is: A. attainable and the economy is efficient. c) unattainable and efficient. A point or combination that is on the production possibilities frontier is a) attainable and efficient. b. nonfeasible point. SURVEY . Any point inside the production possibilities curve is a (an) a. efficient point. This shows inefficiency because a firm is not using all of its resources. For the second question, the answer is B. Production Possibility Curve is a graphical representation of alternative production possibilities facing an economy. If a point lies inside the curve, this tells the company what? Operation of the Economy on the PPC. Any point inside the production possibilities curve is a (an) a. efficient point. one direction) from your point to infinity. Since labor is a resource, unemployment means that labor is not being used to its fullest extent, so the economy can't produce as much as the points on the PPC--instead it has to produce some smaller amount of stuff in general, which is represented by a point inside the curve. 7. If the economy operates on PPF (like points A, B or C), it means resources are fully and efficiently utilised. For polygons see, for example, this link which deals with both ideas. When it is at full employment, it operates on the PPC. Represents the prevalence of unemployment. Leftward shift of PPC. Question 13 . 6. When there is a movement from point A within the boundary of the PPC to point B on the PPC, it means that (a) the country’s resources are more fully employed. The PPC shows the maximum available possibilities which an economy can produce. answer choices If you're seeing this message, it means we're having trouble loading external resources on our website. When inside the PPC, it is possible to get more of both goods by utilizing idle resources, or using resources to their capacity. Represents inefficient use of resources. 0 0. Production Possibility Curve (PPC) is the locus (the path of a moving point) of various combinations of two commodities which can be produced with given level of … A point inside a production possibilities curve represents things that can be produced. Unemployed resources (labor, capital, physical resources) of any kind would result in an inefficient production level, and would be shown as a point to the left, or inside the curve. 30 seconds . One key assumption the PPC makes is that all resources for production are fixed. D. unattainable and the economy is efficient. Efficiency. A point inside the PPF means that resources are not being used efficiently. What things will cause the PPC to shift inward or outward? When an economy is in a recession, it is operating inside the PPC. B) unemployment of labor but not capital. The exact point of operation depends on how well the resources of the economy are used. The PPC shows the combination of goods and/or services that can be produced with the available shared resources. A point inside the PPC means that O A. this particular economy has no comparative advantage in production any economic good O B. economic growth has taken place. C 17) Points inside the PPF are all 17) A) attainable and have some unemployed resources. Conclusion. Prof. Paul A. Samuelson used the concept of the production possibility curve to explain the economic problem of a society. If a point lies on the curve this means the company is being efficient. D)are attainable only with the full utilization of all resources. Q. Any point of production inside the curve is considered inefficient because the economy is not fully utilizing its resources. What does point Y represent on the PPC? A production possibility frontier (PPF) shows the maximum possible output combinations of two goods or services an economy can achieve when all resources are fully and efficiently employed If we increase our output of consumer goods (i.e. Rotation of PPC. SURVEY . What does it mean if a nation is producing at a point inside the PPC? If a point lies on the curve this means the company is being efficient. C) a free lunch. 85. Inside and along the ppf means that goods are attainable and outside the ppf menas the goods are unattainable and it thereby shows scarcity. c. inefficient point. This means that the economy has idle resources and/or resources are not being used to their capacity. [correct answer. If the line crosses the curve an odd number of times the point is inside the curve. In this video, Sal explains how the production possibilities curve model can be used to illustrate changes in a country's actual and potential level of output. Unattainable / impossible. A point outside the production possibilities curve (PPC): A. B. A movement from a point in the PPC to a point on the PPC represents a more efficient use of resources. d. maximum output combination. The economy can produce at any point inside the PPC, but doing so means that the economy is inefficient. A PPC is a graphical illustration of all combination of goods and services that can be produced in a given economy at a given time, if all the available resources in the economy are fully and efficiently employed. If a point lies inside the curve, this tells the company what? In a recession, unemployed workers are not producing goods and services, so the economy is not producing its long run potential. Rightward shift of PPC. Inefficency. If it is operating inside the curve, then it is inefficient, since there are resources that are not being used. None of the above. Any point on the PPC curve. So like our simple example, we plot a point that is inside the production possibilities curve! 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