Use the Figure Below to Answer the Following Questions

Multiple Choice

Use the figure below to answer the following questions.

Figure 2.1.6
-Figure 2.1.6 shows the production possibilities frontier for a firm that produces pet food. This PPF ________ illustrate scarcity because ________.

A) does; the firm cannot produce points outside the frontier, and as the firm moves along the PPF, it cannot produce more dog biscuits without producing less cat food
B) does not; the firm can produce any quantity it wants if it is willing to pay a high enough price
C) does not; the PPF is downward sloping
D) does; as more is produced, consumer must pay a higher price
E) does not; scarcity does not occur in the market for pet food