Production Possibilities Curve (PPC) Review | Think Econ

In this video we explain what the Production Possibilities Curve/Frontier (PPC or PPF) is, as well as demonstrate how it relates to other key concepts such as scarcity, trade offs, opportunity cost, efficiency, etc. This is the first graph you are going to learn in your economics class, so we hope you find this video helpful!

This channel is just getting started so if you enjoyed the content, let us know by liking, commenting, sharing, and subscribing to the channel; it really helps us out. ALOT. We release weekly videos on Thursdays covering all things ECONOMICS!

If you have a great idea that you’d like featured, let us know in the comment section.

If you’re interested in daily content, consider following us on Twitter or Instagram.

Twitter: https://twitter.com/ThinkEconYT
Instagram: https://www.instagram.com/thinkeconyt

Enjoy, and have a great weekend!

~The THINK ECON Team

Production Possibility Frontier (PPF) explained (PPC)

Production possibility frontier PPF also called production possibility curve PPC is A graph that shows all the combinations of goods and services that can be produced if all of society’s resources are used efficiently.
All points below and to the left of the curve (production possibility frontier) represent combinations of Beer and Wine that are possible for the society given the resources available and existing technology.
Although an economy may be operating with full employment of its land, labor, and capital resources, it may still be operating inside its ppf (production possibility frontier), at a point such as A. The economy could be using those resources inefficiently.
Periods of unemployment also correspond to points inside the ppf (production possibility frontier), such as point A.
Moving onto the frontier like point B means achieving full employment of resources.

Points above and to the right of the curve, such as point C, represent combinations that cannot be reached.
If an economy were to end up at point A on the graph, it would be producing no consumer goods at all; all resources would be used for the production of capital. If an economy were to end up at point B, it would produce only consumer goods.

The ppf illustrates a number of economic concepts. One of the most important is opportunity cost. The opportunity cost of producing more Beer is fewer Wine.
0:00 PPF Production Possibility Frontier
3:00 Opportunity cost on the PPF
#productionpossibilityfrontier #ppfexplained#ppcexplained #economics