This situation is perfectly illustrated by the figures. As one may observe, as the units of produced goods increases, the number of units of produced services decreases. The maximum number of units of goods can be produced only if no units of services are produced at the same time.
A d) if the country's economy is producing on its production possibility frontier, the opportunity cost cannot be increased, it cannot be exploited in order to increase the production of goods and services. Therefore, in order to increase production, the country's production possibility frontier must be changed. This could take place by increasing the country's production capacity.
This situation can be influenced by quantities of available resources, on the one hand, and by technological progress, on the other hand. In our case, the situation is influenced by technological progress, which determines increased production with a given quantity of resources.
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