How do you explain the production possibility curve?

How do you explain the production possibility curve?

The production possibility curve portrays the cost of society’s choice between two different goods. An economy that operates at the production possibility frontier, or the very edge of this curve, has the highest standard of living it can achieve, as it is producing as much as it can using its resources.

At what point of the curve does the industry always produce?

The point where minimum average cost is equal to marginal cost is called optimum production.

Why is the PPF curved?

The first is the fact that the budget constraint is a straight line. This is because its slope is given by the relative prices of the two goods. In contrast, the PPF has a curved shape because of the law of the diminishing returns. The second is the absence of specific numbers on the axes of the PPF.

How do you achieve productive efficiency?

To be productively efficient means the economy must be producing on its production possibility frontier. (i.e. it is impossible to produce more of one good without producing less of another). Points A and B are productively efficient.

What do points inside of the production possibility curve represent?

The Production Possibilities Curve (PPC) is a model that captures scarcity and the opportunity costs of choices when faced with the possibility of producing two goods or services. Points on the interior of the PPC are inefficient, points on the PPC are efficient, and points beyond the PPC are unattainable.

What causes PPC to shift?

WHAT CAUSES SHIFT IN PPC? Shifts in the production possibilities curve are caused by things that change the output of an economy, including advances in technology, changes in resources, more education or training (that’s what we call human capital) and changes in the labour force.

How do you find the supply curve in perfect competition?

To find the market supply curve, sum horizontally the individual firms’ sup- ply curves. As firms are identical, we can multiply the individual firm’s supply curve by the number of firms in the market.

What does production possibility curve illustrate?

In business analysis, the production possibility frontier (PPF) is a curve illustrating the varying amounts of two products that can be produced when both depend on the same finite resources. The PPF demonstrates that the production of one commodity may increase only if the production of the other commodity decreases.

What can a PPF graph tell you?

A PPF graph shows the maximum production level for one commodity for any production level of the other commodity. If a point on the graph is above the curve it indicates efficiency, while a point below the curve signifies inefficiency.

What are the time current curves for cables?

Cargill Electrical Team Meeting 10 Time-Current Curves Cables The Time-Current Curves for cables are also known as “Damage” curves. Cargill Electrical Team Meeting 11 Cargill Electrical Team Meeting 12 Time Current Curves Motor The Time-Current Curves for motors are also known as “Damage” curves.

Is the solid damage curve the 100% rating curve?

The solid damage curve is the unbalanced damage curve which takes into account a derating factor for transformer winding type and fault type. The dashed damage curve is the 100% rating curve with no derating consideration. The transformer inrush current is also plotted as a single point on the TCC diagram.

What are the damage curves for a motor?

The Time-Current Curves for motors are also known as “Damage” curves. 13 Time-Current Curves Protective Relays 50 – Instantaneous Overcurrent Relay 51 – AC Time Overcurrent Relay 67 – AC Directional Overcurrent Relay Time-Current Curves Fuses 14

What is the damage curve for a transformer?

There are two transformer damage curves (shown in orange), one is dashed and the other is solid. The solid damage curve is the unbalanced damage curve which takes into account a derating factor for transformer winding type and fault type. The dashed damage curve is the 100% rating curve with no derating consideration.