Sample Production Possibility Curve
Production Possibility Curve
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Production Possibility Curve The production possibility curve (PPC) is defined as a theory that highlights the factors that limit a process the difficulties of making a choice, and the opportunity costs associated with making that decision (Hochstein, 2014, p. 343). Any time a decision is made by a manufacturer of a good, or a country making exports of goods to ready global buyers, the best decisions need to include how to best use the available resources, and gain the best advantage in the chosen markets for selling or exporting the goods to others. A country is in the precarious position to need to export goods to help to pay its debts to other countries and to feed its people. It also needs to find ways to increase its economic advantage in the world markets, and needs to have a measurable amount of output to make this become a reality.
The PPC is illustrated and drawn (the attached pdf drawing of production possibility curve for assignment #1) to show the benefits and detriments of making business related decisions, and helps stakeholders to know the cost of choosing one option over another in business proposals. The PPC only looks at two factors or resources at one time. This means that the PPC is meant to measure two resources and compare them one to the other on a graph which will bow outward or inward once the lines and points on the graph are attached and linked/connected. The PPC curve is illustrated with a PPF model of goods, and each point on the bowed outward curve shows the country is producing a product in an efficient way. The outward bowed curve of the PPC is the best case scenario of a product being produced cheaply, using the proper resources and not wasting money. Countries globally have to assess global updated economic conditions, measure and anticipate inflation, and work to project the long-term possibility for the nation’s economy to increase
Name
Academic Institution
Class
Professor
Date
Production Possibility Curve The production possibility curve (PPC) is defined as a theory that highlights the factors that limit a process the difficulties of making a choice, and the opportunity costs associated with making that decision (Hochstein, 2014, p. 343). Any time a decision is made by a manufacturer of a good, or a country making exports of goods to ready global buyers, the best decisions need to include how to best use the available resources, and gain the best advantage in the chosen markets for selling or exporting the goods to others. A country is in the precarious position to need to export goods to help to pay its debts to other countries and to feed its people. It also needs to find ways to increase its economic advantage in the world markets, and needs to have a measurable amount of output to make this become a reality.
The PPC is illustrated and drawn (the attached pdf drawing of production possibility curve for assignment #1) to show the benefits and detriments of making business related decisions, and helps stakeholders to know the cost of choosing one option over another in business proposals. The PPC only looks at two factors or resources at one time. This means that the PPC is meant to measure two resources and compare them one to the other on a graph which will bow outward or inward once the lines and points on the graph are attached and linked/connected. The PPC curve is illustrated with a PPF model of goods, and each point on the bowed outward curve shows the country is producing a product in an efficient way. The outward bowed curve of the PPC is the best case scenario of a product being produced cheaply, using the proper resources and not wasting money. Countries globally have to assess global updated economic conditions, measure and anticipate inflation, and work to project the long-term possibility for the nation’s economy to increase
References: Arnold, R. (2009). The challenges of estimating potential output in real time. Review (00149187), 91(4), 271-290 Burgen, E., Meyer, B., Tasci, M. (2012). An elusive relation between unemployment and GDP growth: Okun’s Law Economic structure and content: natural resources (2012). United States Country Monitor, 17-18. EBSCO Database: MasterFILE Premier. Fahey, J. (2012). U.S. may soon become world’s top oil producer. Fort Worth Business Press, 24(43), 5-6 Hochstein, A. (2014). Accelerator vs. multiplier in a production possibility curve framework. International Advances in Economic Research, 20(3), 343-344 Kliass, P. (2012). Beyond GDP: Dissecting Brazil’s economic success. NACLA Report on the Americas, 45(2), 26-27