Answer to Question #228917 in Microeconomics for Cebo

Question

Explain the meaning of the following concepts in terms of the production possibility frontier.

1.2.1 Attainable points of production

1.2.2 Unattainable points of production

1.2.3 Inefficiency

Answer 1

Attainable points of production

These are points on the production possibility curve.These points shows that the goods can be produced with current available resources.

Unattainable points of production

Points above the production possibility curve are unattainable. This because the goods cannot be produced with the available resources.

Inneficiency

These are points inside the production possibility curve. This is because the economy can produce at least more of one good using the available resources without sacrificing the production of the other.