Question

Which of the following definition is correct answer of the production possibility set of the economy?

• A. The collection of all possible combination of the goods and services that can not be produced a fixed amount
• B. The collection of all possible combinations of goods and services that can be produced from a given amount of resources and a given stock of technological knowledge
• C. The combination of different type of goods and its utilisation are related with each other
• D. The combination of all goods and its resources creates the production possibility curve

Answer 1

Answer: (B)

The collection of all possible combinations of goods and services that can be produced from a given amount of resources and a given stock of technological knowledge

Answer 2

The correct option is (B): The collection of all possible combinations of goods and services that can be produced from a given amount of resources and a given stock of technological knowledge