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Scarcity, choice, and the PPF

Scarcity, choice, and the PPF

Side-by-side PPFs for Country A and Country B, with A intercepts at 100 cars and 200 tonnes of wheat and B intercepts at 50 cars and 150 tonnes of wheat, showing lower opportunity cost of cars in Country A

A production possibility frontier, or PPF, shows the maximum combinations of two goods an economy can produce when resources are fully and efficiently used. Points on the frontier are productively efficient. Because resources are scarce, producing more of one good means giving up some of another.

4.1.2 Specialisation and trade Lesson

  1. A Level
  2. /Economics
  3. /4.1.2 Specialisation and trade