Question

Concept of shift nd rotation of ppc

Answer 1

Production Possibility Curve (PPC) is the curve which shows different combination of amounts of two good which are made by the available resources in an economy.

Rotation :-

▪PPC rotates a bit when any of its one good's amount increases or decreases in comparison to another good.

▪For instance, there are two goods, X and Y. If amount of X increases or decreases but Y stays constant so it makes PPC get rotated.

▪This rotation gets rightwards and leftwards with both goods. See the first attachment.

Shift :-

▪PPC shifts inwards and outwards when the impact of economical change is shown on the output.

▪The shift of inwards ppc are given below :-

1. Poor technology

2. Lack of resources

3. Disaster

▪The shift of outwards ppc are given below :-

1. Good technology

2. Increase in resources

3. Governmental schemes