Introduction of Micro-Economics — Economics STD 11 Commerce — Question
CBSE BoardEnglish MediumSTD 11 CommerceEconomicsIntroduction of Micro-Economics1 Mark
Question
Define Production Possibility Curve er and state its properties.
✓
Answer
Production possibility curve is a curve which depicts all possible combinations of two goods which can be produced with given resources and technology in an economy. Therefore, if an economy decides to produce a quantity of one commodity, then they have to sacrifice the production of another commodity.
Resources in every economy are always scarce. But the available resources can be put to alternative uses. Therefore, an economy will always prefer to make use of its resources in production of those goods and services that are most required and sacrifice the production of less required goods and services.
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