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Let’s assume a village only produces butter and cheese. Can we apply the Production Possibility Frontier...

Let’s assume a village only produces butter and cheese. Can we apply the Production Possibility Frontier (PPF) model in this situation? Discuss why or why not.

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Answer #1

The production possibility frontier or PPF curve is the graphical depiction of the possible combinations of total output of the two products in given level of resources or factors of production.
The PPF curve can be constructed for two products in the two-dimensional graphical constraint. The information provided in the question indicates that the village has only two products that is butter and cheese. The PPF curve can be constructed for the situation mentioned as it fulfills the condition.

The graph above depicts the PPF curve for the village for the given two products that is cheese and butter.
Every point on the curve is combination of total production of butter and cheese within resource constraint.

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