Production Possibilities Curve Quiz
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Questions and Answers

Which of the following is NOT a key assumption of the Production Possibilities Curve?

  • Full employment of resources
  • Fixed Resources
  • Flexible Technology (correct)
  • Only two goods can be produced

    • What is the Law of Increasing Opportunity Cost?

  • As you produce more of any good, the opportunity cost will decrease
  • As you produce more of any good, the opportunity cost will fluctuate
  • As you produce more of any good, the opportunity cost will increase (correct)
  • As you produce more of any good, the opportunity cost will remain constant

    • Why are resources not easily adaptable to producing both goods?

  • Because of scarcity
  • Because of trade-offs
  • Because of fixed resources (correct)
  • Because of flexible technology

    • Which of the following is NOT a concept that a production possibilities curve demonstrates?

    <p>Demand and supply</p> Signup and view all the answers

    What is the purpose of a production possibilities curve?

    <p>To illustrate the relationship between scarcity and choices.</p> Signup and view all the answers

    What is one of the key assumptions of a production possibilities curve?

    <p>Fixed resources</p> Signup and view all the answers

    What is the production possibilities curve used for in economics?

    <p>To illustrate economic concepts such as scarcity and opportunity cost.</p> Signup and view all the answers

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