Production possibility curves

Learning objectives

Construct a production possibility curve from data and explain what points on, inside and outside the curve show about the use of resources

Explain why a PPC concave to the origin shows increasing opportunity cost and a straight-line PPC constant opportunity cost, and read opportunity cost off a PPC

Distinguish a movement along a PPC from a shift of the curve, and analyse the causes and consequences of outward and inward shifts

Use a PPC to show productive efficiency, unemployed resources and the choice between capital goods and consumer goods