Question

select the correct answer.
what does a production possibilities curve represent?
a. a combination of price and demand of goods and services
b. a combination of the goods produced before and after a change in a factor of production
c. a combination of two factors of production used to produce a single good or service
d. a combination of two goods that can be produced using limited resources

Explanation:

To determine the correct answer, we analyze each option based on the definition of a production possibilities curve (PPC). The PPC shows the maximum combinations of two goods an economy can produce with its limited resources and given technology.

• Option A: PPC is not about price - demand combinations, so A is incorrect.
• Option B: PPC represents production possibilities at a given time with existing resources, not before - after a factor change (that's a shift in PPC, not what the curve itself represents), so B is incorrect.
• Option C: PPC is about two goods, not two factors for one good, so C is incorrect.
• Option D: Matches the definition of PPC as it shows combinations of two goods producible with limited resources.

Answer:

D. a combination of two goods that can be produced using limited resources