1 / 6

Production Possibilities Frontiers

Opportunity cost is the value of the next best alternative that is given up when making a decision. In the case of Farmer Russ, if he chooses to grow 600 bushels of wheat instead of keeping 400 cows, we must evaluate the cost associated with this choice. The Production Possibilities Frontier (PPF) illustrates the various combinations of goods an economy can produce, emphasizing the trade-offs involved. When producing 3 robots, we must also consider the opportunity cost in terms of what resources could have been allocated elsewhere.

elton
Télécharger la présentation

Production Possibilities Frontiers

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Production Possibilities Frontiers

  2. Pull out a blank sheet of paper and put your notes and book away Answer the following questions; Describe opportunity cost in your own words Farmer Russ can grow 300 bushels of wheat or keep 400 cows. What is Farmer Russ’s opportunity cost of growing 600 bushels of wheat?

  3. Production Possibilities Frontier - A graph that shows many different ways to use an economy’s resources

  4. In this model what is the opportunity cost of producing 3 robots?

More Related