Answer to Question #131770 in Microeconomics for Ritika

Question

Illustration society's trade off between two goods a clean environment and quantity of industrial output.what do u suppose determines the shape and position of the frontier? Show inefficent and unattainable points with reference to production possibility curve

Answer 1

The production possibility frontier (PPF) is an illustration of society's trade off between two goods, which are a clean environment and quantity of industrial output. The shape and position of the frontier are determined with the level of technology, possibility for substitution between these goods, the amount of resources available. Inefficent points are below the PPF and unattainable points are above the PPF.