Answered: If a PPF is "bowed outward" from the…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Related questions

Concept explainers

Question

If a PPF is "bowed outward" from the origin, then which of the following can be true? (check all that apply)

The opportunity cost of producing another unit of the good on the y-axis decreases in terms of foregoing units of the good on the x-axis that are given up.

The opportunity cost of producing another unit of the good on the x-axis increases in terms of foregoing units of the good on the y-axis that are given up.

Inputs may be specialized for different uses

Each unit of labor isn't equally productive in producing every unit of each good

Expert Solution

Step 1: Define production possibility frontier(PPF)

The production possibility frontier(PPF):

PPF: Graphical representation of the combination of two goods that can be produced in the economy in a particular period of time. As the available resources in the economy are scarce they must be utilized optimally. In simple words, it shows the maximum output of the combination of specific products that can be produced in an economy.

Step by step

Solved in 4 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions