What us production possibility curve?

1.	What us production possibility curve?
Answer» The\xa0production possibilities curve\xa0(PPC) is a\xa0graph\xa0that shows all of the different combinations of output that can be produced given current resources and technology. Sometimes called the\xa0production possibilities frontier\xa0(PPF), the PPC illustrates scarcity and tradeoffs. The\xa0PPF\xa0is extremely\xa0important\xa0in describing a range of economic phenomena. The\xa0PPF\xa0can be used to explain the concept of opportunity cost: Rather than measuring costs in dollars which are rather arbitrary (and change with inflation), we can measure the cost of\xa0producing\xa0one good in terms of not\xa0producing\xa0other goods.

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