Question

.
Which assumptions must be in place to plot all the possibilities on a Production Possibility Curve?

Choose TWO correct responses.

Select A
Everyone in the society has a job.

Select B
Natural resources are scarce.

Select C
Everyone in the society is unemployed

Select D
All resources are used efficiently

Select E
No modern technology is available.

Answer 1

B and D

- B: Scarcity of resources is required — limited inputs force trade-offs.
- D: All resources used efficiently (full employment/productive efficiency) ensures points on the curve represent maximum possible output combinations.