If a point falls inside the production possibility curve, what does it indicate?
  • a)
    Resources are over utilized
  • b)
    Resources are under utilized
  • c)
    There is employment in the economy
  • d)
    Both (b) and (c)
Correct answer is option 'B'. Can you explain this answer?

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Answers

Divya Soni
Sep 04, 2018
It shows that resources are underutilized. Because when the resources are full utilized then the point comes on production possibly curve. aAnd when resources are not fully utilized it will not reach upto the production possibly curve,it remains under the ppc

Nitin Mishra
Jul 04, 2018
A point lying inside the production possibilities curve indicates underutilization, unemployment, or inefficient use of resources: more goods and services could be produced by using the limited resources more fully and efficiently.

Bhagat K
Sep 09, 2019
Why is D is not correct option there is also an employment no

It shows that resources are underutilized. Because when the resources are full utilized then the point comes on production possibly curve. aAnd when resources are not fully utilized it will not reach upto the production possibly curve,it remains under the ppc
It shows that resources are underutilized. Because when the resources are full utilized then the point comes on production possibly curve. aAnd when resources are not fully utilized it will not reach upto the production possibly curve,it remains under the ppc