Asked by Meera Patel on May 09, 2024
Verified
Refer to Figure 2-3. Suppose this economy is producing at point D. Which of the following statements would best explain this situation?
A) The economy has insufficient resources to produce at a more desirable point.
B) The economy's available technology prevents it from producing at a more desirable point.
C) There is widespread unemployment in the economy.
D) The economy is experiencing economic growth.
Widespread Unemployment
A situation where a significant portion of the workforce is without jobs, spreading across most sectors and regions of an economy.
Economic Growth
Economic growth refers to an increase in a country's production of goods and services, typically measured by the growth in real gross domestic product (GDP) over time.
- Identify the significance of the production possibilities frontier (PPF) and its impact.
- Understand the relationship between efficiency, opportunity cost, and economic production points.
Verified Answer
CC
Cindy CantyMay 12, 2024
Final Answer :
C
Explanation :
Point D, being inside the production possibilities frontier, indicates that not all resources are being used efficiently, which is often due to widespread unemployment.
Learning Objectives
- Identify the significance of the production possibilities frontier (PPF) and its impact.
- Understand the relationship between efficiency, opportunity cost, and economic production points.