Production Possibilities Curve- Self Paced Lesson

Production Possibilities Curve-

Self Paced Lesson

Multiple Choice

What does the term PPC stand for?

• Products Premium Continuum

• Production Possibilities Cycle

• Possible Production Curve

• Production Possibilities Curve

Multiple Choice

What is the production possibilities curve?

• a graph that shows how much an economy can produce between 2 goods

• how much money something is

• the opportunity one has to give up in order to gain something else

• land, labor, capital, entrepreneurs

Multiple Choice

Efficiency is producing the maximum possible output from available resources

• True

• False

Multiple Choice

The production possibilities curve is an illustration of what?

• Opportunity costs and trade-offs

• Only opportunity costs

• Only trade-offs

• none of the above

Multiple Choice

What is opportunity cost?

• a graph that shows how much an economy can produce between 2 goods

• how much money something is

• the opportunity one has to give up in order to gain something else

• land, labor, capital, entrepreneurs

Multiple Choice

Movement down the PPF curve indicates that the opportunity cost of more capital goods is producing more consumer goods

• True

• False

Multiple Choice

What does point Y represent on the PPC?

• Efficiency

• Unattainable / impossible

• Inefficency

• Nothing

Multiple Choice

What do points inside the PPF indicate?

• The combination of goods that employ goods efficiently

• The combination of goods that employ resources fully

• The combination of goods that do not employ resources fully

Multiple Choice

Which point represents "resources are not being used efficiently, or resources are being wasted or idle"?

• Point A

• Point Y

• Point X

• All of the above

Multiple Choice

What does point B represent?

• Production at greater than the country's minimum potential

• Production is less than the country's minimum potential

• Productive inefficiency

• Productive efficiency

Multiple Choice

If a point lies on the curve this means the company is being efficient. If a point lies inside the curve, this tells the company what?

• They are being over efficient

• They are not efficient

• It is impossible

• None of the above

Multiple Choice

If a natural disaster strikes, the production possibilities curve can shift

• No shift

• To the left

• To the right

• Outward on one axis only

Multiple Choice

If a point lies on the curve this means the company/country/individual is being efficient. If a point lies inside the curve, what does that tell?

• They are being over efficient

• There is an idle, or unproductive, or use of resources

• It is not impossible with the given resources

• They are still efficient, just at another point

Multiple Choice

If many workers decide to retire at an early age, the PPC would shift inward.

• True

• False

Open Ended

Explain why the PPC would shift inward of many workers decide to retire at an earlier age?

Multiple Choice

Changes in technology do not usually affect production

• True

• False

Multiple Choice

If there is improved technique of Production in both the goods , how will the PPC be affected?

• Leftward shift of PPC

• Rightward shift of PPC

• Rotation of PPC

• None of the above

Multiple Choice

What can cause a production possibilities curve to move to the right?

• thousands of people move out of the country

• an epidemic kills thousands of young men and women

• a new invention lowers the cost of production

• the population is growing increasingly old

Multiple Choice

Economic growth affects the PPF by...

• Shifting inward

• Shifting outward

• causing no change at all

• turning it into a straight line

Multiple Choice

An increase in the labor force would cause the PPF to 

• Shift inward

• Shift outward

• Do nothing

• Turn into a straight line

Multiple Choice

Suppose that a new machine that speeds up automotive production is introduced into the auto industry. This would cause the PPF to

• Shift outward

• Shift inward

• Do nothing

• Not enough information is provided

Multiple Choice

In the following graph, PPC of country XYZ is currently at the blue line. Suggest one way in which this production combination can increased

• Technology increase in both production

• Decrease in population

• There is huge drop in country XYZ's economy growth

• Natural disaster in country XYZ

Open Ended

Give at least 3 real world examples of how the PPC could shift outward? For each example, state why it shifts outward.

Open Ended

Give at least 3 real world examples of how the PPC could shift inward? For each example, state why it shifts inward.