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In a typical production possibilities frontier that is negatively sloped and "bowed outward" from the origin where resources are fully utilized in the production of cars and computers, when the current production of cars and computers is efficient: Select one: a

Economics Aug 07, 2020

In a typical production possibilities frontier that is negatively sloped and "bowed outward" from the origin where resources are fully utilized in the production of cars and computers, when the current production of cars and computers is efficient:

Select one:

a. It is not possible to rearrange production to produce less cars and more computers.

b. It is not possible to rearrange production to produce less cars and less computers.

c. It is not possible to rearrange production to produce more cars and less computers.

d. It is not possible to rearrange production to produce more cars and more computers.

Expert Solution

A production possibility curve represent the production of two type of goods in any economy over a given period of time in various combination

The shape is generally bowed outwards

It follows the law of increasing opportunity cost

Here the two good produced are cars in computers

Now according to question if it is said that the current production of cars in computer is efficient it means the production is done on the production possibility Frontier

So it is possible to arrange this production less than or equal to it but with the given resources and technology it is not possible to rearrange production to produce more cars and more computer because if it happens then production possibility curve shift outwards but we do not have enough resources and technology to do this

The correct answer here is option d

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