Any combination of products inside the production possibility frontier is ?
Correct answer: D. Productively inefficient
- A. Allocatively inefficient
- B. X inefficient
- C. Consumer inefficient
- D. Productively inefficient
Explanation
A point inside the production possibility frontier means the economy is not using its resources fully or efficiently, so it is productively inefficient. Points on the frontier represent productive efficiency.
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Individual consumers, firms and markets are examined through demand and supply, elasticity, consumer choice, production, costs, revenue and the determination of prices and output. The topic also covers market structures such as perfect competition, monopoly and oligopoly, plus market failure, externalities and the distinction between microeconomic decisions and economy-wide outcomes.
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