The diagram below shows a Production Possibility Frontier (PPF) for an economy that produces healthcare units and education units.
Which of the following statements correctly explains how the three elements of the fundamental economic problem (scarcity, choice, and opportunity cost) are illustrated by the diagram?
Scarcity is illustrated by point XXX where resources are underutilized; choice is represented by the unobtainable point WWW; and opportunity cost is represented by the constant trade-off between points XXX and YYY.
Scarcity is illustrated by the fact that point WWW is unobtainable; choice is represented by the necessity to select a single combination along the boundary, such as YYY or ZZZ; and opportunity cost is represented by the sacrifice of healthcare units when moving from point YYY to point ZZZ.
Scarcity is illustrated by the finite boundary of the PPF itself; choice is represented by the ability to move from point XXX to point YYY without any resource reallocation; and opportunity cost is illustrated by the maximum output of education (100100100 units) when healthcare is zero.
Scarcity is illustrated by the concave shape of the PPF; choice is illustrated by the decision to produce at point XXX instead of point WWW; and opportunity cost is illustrated by the physical distance between points YYY and ZZZ.
