What graph illustrates the maximum production capabilities of an economy?

The Production Possibility Frontier (PPF) graph is the appropriate choice to illustrate the maximum production capabilities of an economy. The PPF represents the various combinations of two goods or services that an economy can produce when utilizing all of its available resources efficiently. It effectively demonstrates the trade-offs between producing different goods and highlights concepts such as opportunity cost, efficiency, and economic growth.

On the PPF curve, points along the line indicate maximum efficiency, meaning that resources are being used to their fullest potential. Points inside the curve depict underutilization of resources, while points outside the curve are unattainable with the current resource constraints. Hence, the PPF serves as a vital tool to understand the limits of production in an economy and how resources can be allocated for optimal output.

In contrast, the demand curve illustrates consumer preferences for various quantities of a good at different prices, the supply and demand graph primarily focuses on market equilibrium and interactions between supply and demand, and the equilibrium model analyzes pricing and quantity in the context of market balance. None of these represent the maximum production capabilities of an economy like the PPF does.