PPF Flashcards
1
Q
What causes a shift to the right in a ppf graph
A
Economic Growth
2
Q
What is a PPF
A
A graph that shows the maximum combinations of any 2 goods that can be produced when resources and technology are used effectively
3
Q
Shape of a PPF
A
Negative slope : to produce more consumer goods less capital goods are produced, happens at an exponential rate so greater opportunity cost as more is made
4
Q
Points above the PPF are?
A
Not feasible with existing resources
5
Q
Points within the PPF are:
A
Periods of unemployment or inefficiency
6
Q
Causes for economic growth
A
Increase in resources i.e. investment
Increase in productivity i.e. more output per input
Improved technology
7
Q
Causes for economic decline
A
Loss of resources
