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how do you calculate production possibilities frontiers

how do you calculate production possibilities frontiers

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Answer #1

Production possibility frontier are not calculated, they are only a graphical representation of what is produced in the economy. they show the two good that the economy can produce with the given resources. it also shows the opportunity cost of the goods produced i.e if we produce more of one good then we have to reduce the production of other good.

An increase in the production capacity of the economy will shift the PPF to the right and a decreases will shift it to the left.

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