What does a production possibilities curve represent? a combination of price and demand of goods and services a combination of the goods produced before and after a change in a factor of production a combination of two factors of production used to produce a single good or service a combination of two goods that can be produced using limited resources

Answer;
Combination of two goods that can be produced using limited resources

Explanation;
A production possibilities curve is a graphical representation of the alternative combinations of goods and services an economy can produce. Considering the fact that an economy's factors of production are scarce; they can not produce an unlimited quantity of goods and services, a production curve is crucial in determining the alternative combinations of goods and services. For example if the curve is a straight line, it means the for every unit of good y relinquished, an additional unit of good x can be produced.

chilljain33 chilljain33 · Answer 2 · 2022-02-01T08:14:46+01:00

The correct statement is that a production possibility curve represents a combination of two goods that can be produced using the limited resources. So, the correct option is D.

Production possibilities curve is a representation which shows what quantity of goods can be produced by use of the resources available during such given period of time for obtaining maximum output.

What is a Production Possibilities Curve?

Production possibilities curve is a graphical representation of quantities of goods that are possible for such production so that optimum utilization of limited resources is done.

The use of scarce or limited resources is done in order to achieve efficiency in production and maximizing the profits that can be gained by choosing which goods are to be produced.

Representation of quantities of both the goods which meet at a point in the graph represent equilibrium point, which denotes that the production and output will be optimum at this point.

Hence, the correct option is D that Production Possibilities Curve is a representation of combination of two goods that can be produced using the limited resources. Please refer to the image attached herewith.

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