Key model. The Production Possibilities Curve (PPC) is a model that captures scarcity and the opportunity costs of choices when faced with the possibility of producing two goods or services. Points on the interior of the PPC are inefficient, points on the PPC are efficient, and points beyond the PPC are unattainable.
What does a point on a production possibilities frontier represent?
According to the PPF, points A, B, and C on the PPF curve represent the most efficient use of resources by the economy. Point X represents an inefficient use of resources, while point Y represents a goal that the economy simply cannot attain with its present levels of resources.
Is production at a point outside the production possibilities curve currently possible?
Production outside the curve cannot occur (consumption outside the curve could occur through foreign trade). To produce beyond the current production possibilities curve this economy must realize an increase in its available resources and/or technology.
Where are the production possibilities in Chapter 1?
A. above or to the right of the production possibilities frontier. B. directly on the production possibilities frontier. C. just beyond the future production possibilities frontier. D. below or to the left of the production possibilities frontier. D. below or to the left of the production possibilities frontier.
Where are fewer resources left to make something else?
C. fewer resources are left to make something else. A. above or to the right of the production possibilities frontier. B. directly on the production possibilities frontier. C. just beyond the future production possibilities frontier. D. below or to the left of the production possibilities frontier.
Why does a country’s production possibilities increase?
A country’s production possibilities increase because the available workers become more skilled at using a computer. This is an example of growth caused by _____. What is using fewer resources than an economy is capable of using called?
Why are there always opportunity costs when we shift from one product to another?
Why are there always opportunity costs when we shift from making one product to another? A. Some resources are better suited for use in making the first product. B. There is always more demand for the first product than the second product. C. Consumers must be convinced to buy the second product.
