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JAMB Economics 1987 Question 1

Question 1

Basic Concepts

A production possibility curve shows

  1. A.how much of the resources of society are used to produce a particular commodity
  2. B.the rate of inflation
  3. C.the rate of unemployment in the economy
  4. D.the various combinations of two commodities that can be produced.
Show the answer and explanation

Answer: D (the various combinations of two commodities that can be produced.)

Explanation

A production possibility curve plots every combination of two goods that can be made when all resources are fully used.