Question

Given below are two statements:
• [Statement (I):] If resources are not fully and efficiently utilized, then potential level of output will be less than actual level of output. 
• [Statement (II):] Production possibility curve refers to the minimum possible level of output attainable with the available resources. 
In light of the above statements, choose the most appropriate answer from the options given below. 
 

• A. Both Statement (I) and Statement (II) are correct.
• B. Both Statement (I) and Statement (II) are incorrect.
• C. Statement (I) is correct but Statement (II) is incorrect.
• D. Statement (I) is incorrect but Statement (II) is correct.

Hint:

To remember PPC concepts:
- On the PPC: Full and efficient resource utilization (\(\text{Actual} = \text{Potential}\)).
- Inside the PPC: Underutilization or inefficiency (\(\text{Actual} < \text{Potential}\)).
- Outside the PPC: Unattainable with current resources and technology.

Answer 1

The Correct Option is B