Meaning of Production Possibility Curve (PPC) - SS2 Economics Past Questions and Answers - page 1
The production possibility curve shows:
The maximum amount of one good that an economy can produce
The maximum amount of two different goods that an economy can produce
The minimum amount of one good that an economy can produce
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What does a point inside the PPC represent?
Efficient use of resources
Inefficient use of resources
Unattainable production levels
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The slope of the PPC represents:
The rate at which resources are being utilized
The rate at which the economy is growing
The rate at which one good must be sacrificed for an additional unit of the other good
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Points outside the PPC represent:
Efficient use of resources
Inefficient use of resources
Unattainable production levels
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The PPC is a useful tool for:
Analyzing consumer behaviour
Analyzing an economy's production efficiency
Analyzing international trade policies
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What is the concept of increasing opportunity cost?
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How can an economy use the PPC to improve its overall welfare?
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