Meaning of Production Possibility Curve (PPC) - SS2 Economics Past Questions and Answers - page 1
1
The production possibility curve shows:
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A
The maximum amount of one good that an economy can produce
B
The maximum amount of two different goods that an economy can produce
C
The minimum amount of one good that an economy can produce
2
What does a point inside the PPC represent?
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A
Efficient use of resources
B
Inefficient use of resources
C
Unattainable production levels
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3
The slope of the PPC represents:
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A
The rate at which resources are being utilized
B
The rate at which the economy is growing
C
The rate at which one good must be sacrificed for an additional unit of the other good
4
Points outside the PPC represent:
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A
 Efficient use of resources
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B
Inefficient use of resources
C
Unattainable production levels
5
The PPC is a useful tool for:
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A
Analyzing consumer behaviour
B
Analyzing an economy's production efficiency
C
Analyzing international trade policies
6
What is the concept of increasing opportunity cost?
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7
How can an economy use the PPC to improve its overall welfare?
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