Question

2.1(i) Explain how production possibility curve illustrates scarcity, choice and opportunity cost. (ii)"An increase in the demand for notebooks raises the quantity of notebooks demanded but not the quantity supplied" is this statement true or false? Explain, (9+9.75)​

Answer 1

Answer:

1. The Production Possibilities Curve (PPC) is a model that captures scarcity and the opportunity costs of choices when faced with the possibility of producing two goods or services. Points on the interior of the PPC are inefficient, points on the PPC are efficient, and points beyond the PPC are unattainable.
2. The statement that "an increase in the demand for notebooks raises the quantity of notebooks demanded, but not the quantity supplied," in general, is false. The increase in demand for notebooks results in an increased quantity supplied.

By Arihant kumar

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