Which of the following statements is NOT true regarding production technologies in the context of the Production Possibilities Frontier (PPF)?

• A. Production technologies have no impact on the shape or position of the PPF.
• B. All points on the PPF represent combinations of goods produced using available resources efficiently.
• C. Different production technologies can affect the opportunity cost of producing one good over another.
• D. Technological improvement can shift the PPF outward, allowing more of both goods to be produced.

Answer: (A)

Verified step by step guidance

1. Step 1: Understand the Production Possibilities Frontier (PPF) — it represents the maximum combinations of two goods that an economy can produce using all available resources efficiently.
2. Step 2: Recognize that the shape and position of the PPF depend on factors such as resource availability and production technology.
3. Step 3: Analyze how production technologies influence the PPF: improvements in technology can increase productivity, shifting the PPF outward, and different technologies can change opportunity costs, affecting the slope of the PPF.
4. Step 4: Evaluate each statement by comparing it to the role of technology in production: statements about efficient use of resources and opportunity costs are true, while the statement claiming technology has no impact on the PPF's shape or position contradicts economic theory.
5. Step 5: Conclude that the statement 'Production technologies have no impact on the shape or position of the PPF' is NOT true because technology directly affects both the position and shape of the PPF.