It is a model of a macro economy used to analyze the production decisions in the economy and the problem of scarcity. If a company produces 20,000 watermelons and 1,20,000 pineapples. 5. The Particular Area In Question Can Be Used For Timber Production And/or Recreation. A point below the curve means the production is not utilising 100 per cent of the ‘business’s resources. Figure 2.9 Efficient Versus Inefficient Production. 2. Curve showing all combinations of two goods that can be produced with resources and technology available Society’s choices are limited to points on or inside the PPF Production possibility curve is the curve that show the combination of two item or services that can be produce in the market in a certain amount of time provided that all other eternal factor that can effect the curve are kept constant such as, labour, technology land and capital. To define the meaning of production possibility curves. Introduction Important Questions for Class 12 Economics Central Problems of An Economy, Production Possibility Curve and Opportunity Cost. Production Possibilities Curve Answers Directions: Use the information in FIGURE 1 PPC to answer the following questions about the Alpha economy. Our experts can answer your tough homework and study questions. Figure 1 shows the production possibilities curve for Alpha, which makes two products: weapons of mass destruction and food. Production Possibilities Curve Example. The Shape Of The Production Possibility Curve Depends On The Relationship The Two Uses Share. Ask a question. The following diagram (21.2) illustrates the production possibilities set out in the above table. On the diagram, its point B. 3. In this diagram AF is the production possibility curve, also called or the production possibility frontier, which shows the various combinations of the two goods which the economy can produce with a given amount of resources. 1.Economic Problem Problem of choice or a problem of allocation of resources is the major economic problem which arises due to scarce resources and alternative uses of resources. Answer: The Production Possibilities Curve (PPC) is a model used to show the tradeoffs associated with allocating resources between the production of two goods. Define a production possibilities frontier (curve). Questions you should be able to answer after the lesson. Production Possibilities Frontier Production Possibilities Frontier is the line that shows the maximum possible output for that economy. Production Possibility Curve has the following basic properties : Production Possibility curve slopes Downward: PPC curve slopes downward from left to right. Explain the difference between a bowed out PPC and a straight line PPC. Definition & Example To understand the economic implication of the production possibility curve model. 1. 3. A point above the curve indicates unattainable with the available resources. Scarcity, Choice, and the Production Possibilities Curve Chapter Exam Instructions. Draw a PPC demonstrating what a point on, inside and outside of the curve represents. To define the implications of scarcity in an economic system. 2. 4. To discuss the economic importance of the law of increasing opportu-nity cost. Production Possibility Curve. Choose your answers to the questions and click 'Next' to see the next set of questions. Production Possibility Curves Objectives 1. With this meaning we have several other aspects also to … Production Possibilities Frontier – the line on a production possibilities graph that Because, at the situation of full utilization of given resources, the production of both goods cannot be increased. 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