lesson 2 - opp cost and ppc Flashcards
1
Q
ppc (production possibility curve)
A
AKA production possibilities frontier
graphic model that shows all combinations that two goods can be produced
2
Q
efficiency
A
the full employment of resources
something is effective when it is on the curve
3
Q
inefficient use of resources
A
if the combination is below the ppc
4
Q
growth
A
the increase in an economy’s ability to produce over time
shift of the ppc
5
Q
contraction
A
decrease in output that occurs due to under utilization
6
Q
constant opportunity costs
A
when the opp cost remains the same as the output increases -> ppc curve is a straight line
7
Q
increasing opp cost
A
opp cost increases as output increases, ppc bowed out from originpr
8
Q
productivity
A
the ability to combine econ resources econ growth
