Mell What are the attainable production points on a production possibility curve?
Any point that lies either on the production possibilities curve or to the left of it is said to be an attainable point: it can be produced with currently available resources.
Are points on the PPC attainable?
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 it mean when a point is outside the production possibilities curve?
A point outside the production possibilities curve represents a combination of goods that is: unattainable. If an economy keeps increasing its capital stock/number of workers/technology/natural resources, then over time its production possibilities curve will: shift to the right.
Can attainable combination points be found outside of the PPC?
We conclude that attainable combination points are (on/inside/outside) the production possibilities curve.
What does each point on a production possibilities curve show?
The PPF is graphically depicted as an arc, with one commodity represented on the X-axis and the other represented on the Y-axis. Each point on the arc shows the most efficient number of the two commodities that can be produced with available resources.
What points are attainable?
These points are attainable (e.g., point U), but they are not using the resources at the fullest. At point U, if technology or resources are used at full capacity, the economy could be at point B or C, meaning more would be produced. All points outside PPF are unattainable (e.g., point Z).
Why is PPC concave?
Production Possibility Curve (PPC) is concave to the origin because of the increasing opportunity cost. As we move down along the PPC, to produce each additional unit of one good, more and more units of other good need to be sacrificed. And this causes the concave shape of PPC.
What does each point on a production possibilities curve represent?
Every point on the production possibilities curve is a point of efficiency. When we cannot produce more of any one good without giving up some other good, we have achieved productive efficiency, and we are producing at a point on the PPF. service is the opportunity cost of producing one more unit of it.
What change would cause the PPC to shift from the original curve?
Shifts in the production possibilities curve are caused by things that change the output of an economy, including advances in technology, changes in resources, more education or training (that’s what we call human capital) and changes in the labor force.
What is the importance of production possibility curve?
The Production Possibilities Curve (PPC) is a model used to show the tradeoffs associated with allocating resources between the production of two goods. The PPC can be used to illustrate the concepts of scarcity, opportunity cost, efficiency, inefficiency, economic growth, and contractions.
Where does the economy operate inside the possibilities curve?
B) the economy operates at a point outside the production possibilities curve. C) the production possibilities curve shifts inward. D) the production possibilities curve shifts outward. A) the economy operates at a point inside the production possibilities curve.
Which is production point outside the production possibilities frontier?
9. Any production point outside the production possibilities frontier: A) is attainable only if prices fall. B) is associated with unused resources. C) is attainable only if prices rise. D) is unattainable.
When is a production point is not attainable?
Use the graph below to complete the following question. is not attainable, given society’s available resources and technology. When a production point lies beyond the production possibility curve, that point requires more resources to attain than what society has. This point would be unattainable given the current level of resources and technology.
What are the unattainable points in a production possibilities diagram?
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