"An economy always produces on, but not inside, a PPF", Defend or refu

1.	"An economy always produces on, but not inside, a PPF", Defend or refute.
Answer» Solution :The statement is REFUTED. An economy operates on PPF, only when RESOURCES are fully and efficiently UTILIZED. It means, if there is unemployment or inefficient use of resources, then the economy may operate inside the PPF. So then economy may operate at point 'H' (Fig.1.14) in ADDITION to the points on the curve AB on PPF.

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