Question

Which of the following is not an assumption of the productions possibilities frontier?

a. A country produces only two goods or types of goods.
b. Technology does not change.
c. The amount of available resources does not change.
d. There is a fixed quantity of money.

Answer 1

Answer: Option D

Explanation: A frontier of development possibilities determines the set of choices made by society for the mixture of goods and services it can create, given the available resources capacity. Usually considered for an economy, this balancing act extends to every ordinary citizen, and the economic institution as well.

This curve depicts  the fact that only by reallocating resources from other goods and thus producing less of them can one good be produced as the resources in hand for production is limited.

Hence from the above we can conclude that the correct option is D.