May/June 2026 Paper 12

2026 · 30 questions · 30 parts · 30 marks

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2Production Possibility Curves Growth Trade OffsMedium1 mark
The diagram shows the production possibility curve (PPC) for an economy that can produce goods and services.
a production possibility curve for an economy that produces goods and services, output of goods on the vertical axis and output of services on the horizontal axis, drawn as a single straight line from a positive intercept on the goods axis down to a positive intercept on the services axis
If the economy is producing at the boundary of its PPC, which statement is not correct?