Production possibility curve
Definition
The production possibility curve indicates the combinations of any two goods or
services that are attainable when the society's resources are fully and efficiently
employed.
The production possibility curve is also known as the production possibility frontier
and is a very useful tool to illustrate the economic problem of scarcity and choice.
Important things to notice about the definition of the production possibility curve are:
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It indicates all possible combinations of the production any two goods or
services.
It is assumed that all the resources of a society are used fully and efficiently.
It can be represented in a table and/or graphical format.