What is a combined PPF?

The Production Possibilities Frontier (PPF) is a graph that shows all the different combinations of output of two goods that can be produced using available resources and technology. Points that lie on the PPF illustrate combinations of output that are productively efficient.

Why does the PPF have a curvy shape?

The first is the fact that the budget constraint is a straight line. This is because its slope is given by the relative prices of the two goods. In contrast, the PPF has a curved shape because of the law of the diminishing returns.

Are points outside the PPF efficient?

In the PPF, all points on the curve are points of maximum productive efficiency (no more output of any good can be achieved from the given inputs without sacrificing output of some good); all points inside the frontier (such as A) can be produced but are productively inefficient; all points outside the curve (such as X …

Why do production possibilities frontier curve?

In business analysis, the production possibility frontier (PPF) is a curve illustrating the varying amounts of two products that can be produced when both depend on the same finite resources. The PPF demonstrates that the production of one commodity may increase only if the production of the other commodity decreases.

Which is consumption possibility curve?

The production possibilities curve (PPC) is a graph that shows all of the different combinations of output that can be produced given current resources and technology. Sometimes called the production possibilities frontier (PPF), the PPC illustrates scarcity and tradeoffs.

How to draw a PPF from a graph?

To summarize: In order to draw a PPF you take the numerical information from the table and use it to plot the individual points on a graph. You can then connect the points that were drawn to give you the complete PPF.

How to draw a PPF ( production possibility frontier )?

To summarize: In order to draw a PPF you take the numerical information from the table and use it to plot the individual points on a graph. You can then connect the points that were drawn to give you the complete PPF. It really is the simple process of taking the information from the table and converting it into its graphical representation.

How can I get PPF from a table?

You can then connect the points that were drawn to give you the complete PPF. It really is the simple process of taking the information from the table and converting it into its graphical representation. Remember, the PPF shows the frontier of what is capable for production given fixed inputs.

How does the shape of the PPF depend on?

The shape of the PPF depends on whether there are increasing, decreasing, or constant costs. Points that lie on the PPF illustrate combinations of output that are productively efficient. We cannot determine which points are allocatively efficient without knowing preferences.