Question

What is the Ppc curve

Answer 1

It is a curve depicting all maximum output possibilities for two goods, given a set of inputs consisting of resources and other factors.

Answer 2

Production Possibility Curve:

• It is a curve which shows various combination of two goods that can be produced with the help of given technology and resources in a year.

Extra Information:

1). Marginal Rate of transformation (MRT):

• In PPC Curve it is a ratio of scarifies of good y to gain and additional unit of x.

2). Marginal Opportunity cost (MOC):

• In PPC Curve it is a rate of scarifies of good y to gain and additional unit of x.

3). Shift of PPC curve:

There are two kinds of shift in PPC curve:

1. Forward shift: It happens when then resources or technology is develop.
2. Backward shift: It happens when then resources and technology decreases.