Why is the production possibility frontier concave be sure to explain economic intuition behind that fact the slope of a particular segment of the ppf shows how much good on the vertical axis (milk) has to be sacrificed in order to obtain an additional car (the good on the horizontal axis. The production possibilities frontier or ppf shows the maximum amounts of production that can be obtained by an economy given its technological knowledge and quantity of inputs or resources available. Q14 why is a production possibility curve concave explain q15 define an economy what are capital (market), planned and mixed economies q16 distinguish between market and mixed economy q17 your are to simply tick ( ) yes or no. Micro -economics chapter -1 introduction to economics cbse questions (2012) set-1 1 define microeconomics (set1)1 2 define production possibilities curve explain why it is downward sloping from left to right (set1)3 set-2 3 define microeconomics (set2)1 why is a production possibilities curve concave explain(set3) 3 kv-pre. Best answer: 1) e the production possibility curve shows all other options except what resources are being allocated the resources used in producing the two goods are not mentioned and im sure this is because when we say resources, it meanss alot of this used in the production of a commodity, eg, labor.
Ppc is concave to origin because marginal opportunity cost increase due to law of diminshing returns it means a producer has to sacrifice more and more of one commodity to get an additional unit of other commodity. A production possibility frontier (ppf) shows the maximum possible output combinations of two goods or services an economy can achieve when all resources are fully and efficiently employed we normally draw a ppf on a diagram as concave to the origin ie as we move down the ppf, as more resources. 1 explain why a production possibilities curve is concave 1 -3 (key question) cite three examples of recent decisions that you made in which you, at least implicitly, weighed marginal costs and marginal benefits.
The production possibility curve is a useful tool to explain concepts in neoclassical economics the production possibility curve is strictly hypothetical and static in nature there are no practical ways to actually apply and calculate such a curve. Production possibility frontiers production possibilities mythica, which is a hypothetical economy, produces only two goods - textbooks and computers when it uses all of its resources, it can produce five million computers and fifty five million textbooks this explains why the ppf is concave to the origin, meaning its is bowed. It is much more realistic to acknowledge the arc of the ppc curve, concave to the origin, and showing an increasing opportunity cost as production is shifted from good a to good b this is indicated numerically by a diminishing mrt and logically by resource specialization. Production possibility curve september-25-08 8:35 am 1 the choices that a country has to make about the use of scarce resources available and the associated sacrifice of1 product for the other. Unit 1 introduction 3 -4 marks questions q1 why is a production possibilities curve concave explain ans the production possibility curve being concave means that mrt increases as we move downward along the curve mrt increases because it is assumed that no resource is equally efficient in production.
The concave shape of ppc means that the slope of ppc increases the slope of ppc is defined as the quantity of good y given up in exchange of an additional unit of good x. Production possibility curve is the curve which shows the combinations of two goods and services that can be produced with fuller utilisation of a given amount of resources in the most efficient way and with a given production technology. 2) the shape of the production possibility curve is concave to the origin the opportunity cost for a commodity is the amount of other commodity that has been foregone in order to produce the first the marginal opportunity cost of a particular good along the ppc is defined as the amount sacrificed of the other good per unit increase in the. An economy’s factors of production are scarce they cannot produce an unlimited quantity of goods and services a production possibilities curve is a graphical representation of the alternative combinations of goods and services an economy can produce it illustrates the production possibilities model. Because when one produces one product, the opportunity cost of the other product increases ie the concave represents the increasing opportunity cost with the production of a good.
Productivity possibility curves / 1 production possibility curves opportunity cost (or economic cost or real cost) is not the money we pay for the want, but the alternative want that we have to forego the issue of choice, and the concept of opportunity cost associated with the economic problem, can. Production possibility curve is concave to the origin because to produce each additional unit of good x, more and more unit of good y is to be sacrificed. Now, we can plot this table on a graph to obtain production possibility curve, which is shown in figure-1: in figure-1, the production possibility point’s g and h are attainable combinations, whereas c and e are unattainable combinations.
Production possibility curve (ppc) is concave to the origin because of the increasing opportunity cost as we move down along the ppc, to produce each additional unit of one good, more and more units of other good need to be sacrificed. Explain why scarcity exists people's wants are unlimited and resources are limited lawmakers, preparing a balanced budget for the state of georgia illustrates what concept opportunity costs what does the production possibilities curve for two different products reflect why is the production possibilities curve concave or bowed out.
Concave: decreasing cost (click the [concave] button): this is a concave production possibilities curve with decreasing opportunity cost in this case, opportunity cost actually decreases with greater production. Recognizing the curve production possibility curves usually are displayed as convex curves, with the quantity produced of one product on the x-axis and the quantity of the other product on the y-axis. Why is the production possibility curve (ppc) or production possibility frontier (ppf) concave what does increasing opportunity costs mean when we increase production, why does it seem that we. Production possibility schedule which determines the shape of production possibility curve 4 q5 explain the concept of shift in ppc 4 q6 why production possibility curve is concave to origin 4 q7 explain the shape of ppc 4 understanding q1.