Question

Bolivia has about 50% of the world's reserves of lithium. It is also a major producer of zinc. Suppose that Bolivia produced only those two goods and that its linear production possibilities frontier had the following end points: 20,000 tons of lithium and zero zinc, or 10,000 tons of zinc and no lithium. A combination of 12,000 tons of lithium and 5,000 tons of zinc would be_________________.a. attainable and efficient.b. attainable, but not efficient.c. efficient but not attainable.d. unattainable.

Answer 1

Answer:

The answer is b. attainable, but not efficient.

Explanation:

Points that lie either on or below the production possibilities frontier/curve are possible/attainable and points that lie strictly below the frontier/curve are inefficient, because the economy can produce more of at least one good without sacrificing the production of any other good, with existing resources and technology