Question

If an economy is producing at a point on its production possibilities frontier, it is: ___A. efficient in allocation but not necessarily in production. B. efficient in production and allocation. not necessarily C. efficient in production or allocation. D. efficient in production but not necessarily in allocation.

Answer 1

A. Efficient in production but not necessarily in allocation.

Step-by-step explanation:

Allocation is defined as the distribution of a limited quantity of product during various time periods. The economy in the excersice can produce, therefore is efficient in this aspect but since its distribution is limited its allocation is not efficient.

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