Productive Possibility Frontier (PPF) is a curve showing the combinations of two goods that can be produced with fixed quantities of input.
PPF depicts:
Inefficient point: A
Efficient point: B, D, C
unobtainable production: X
How to depict the opportunity cost on the PPF curve
<aside> ❓ Opportunity cost is the next best alternative forgone.
</aside>
Movement from point C to D results in opportunity cost of 25 units of food.
Movement from point D to C results in opportunity cost of 50 units of cloths.
❓Quiz