Any point on PPC represents : |
Optimum Utilisation of resources Under-utilisation of resources Over-full employment of resources Unattainable Combination |
Optimum Utilisation of resources |
The correct answer is option (1) : Optimum Utilisation of resources Explanation : The Production Possibility Curve (PPC) represents the maximum attainable combinations of two goods that an economy can produce, given its level of technology and the inputs of factors of production. Points on the PPC represent efficient and optimum utilization of resources because the economy is producing the maximum possible output given its constraints. Points inside the curve indicate underutilization of resources, points on the curve represent efficient utilization, and points outside the curve are unattainable with the current level of resources and technology. |