Why is the production possibilities frontier curved?
Understand the Problem
The question is asking why the production possibilities frontier (PPF) is curved. The PPF represents the maximum possible production combinations of two goods or services an economy can achieve when all resources are fully and efficiently employed. The curvature of the PPF reflects the concept of increasing opportunity cost.
Answer
The production possibilities frontier is curved because not all resources can easily be used to produce all goods.
The production possibilities frontier is curved because not all resources can easily be used to produce all goods.
Answer for screen readers
The production possibilities frontier is curved because not all resources can easily be used to produce all goods.
More Information
The curve illustrates the opportunity cost of shifting resources between the production of two goods. The PPF is curved due to the law of diminishing returns.
Tips
A common mistake is confusing a shift in the PPF with the reason it's curved. Shifts represent economic growth or contraction, while the curve itself reflects resource specialization.
Sources
- The Production Possibilities Frontier (article) - Khan Academy - khanacademy.org
- Why is the PPF curved and not straight? | Wyzant Ask An Expert - wyzant.com
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