Question

Explain with the help of a diagram the situation of efficient and inefficient utilisation of resources in an economy​

Answer 1

Answer:

Production possibility curve shows all different attainable combinations of the production of two commodities that can be produced in an economy with given the resources and technology which are to be fully utilized. Therefore, all the points on that blue curve indicates fuller and efficient utilization of resources.

Answer 2

Explanation:

Production possibility curve shows all the different attainable combinations of production of two commodities that can be produced in an economy with the given resources and technology, when they are fully utilized. Therefore, every point inside the PPC indicates inefficient utilization of resources, as denoted by point 'C' in the figure.