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प्रश्न
Giving reason comment on the shape of Production Possibilities curve based on the following schedule:
| Good X (units) | Good Y (units) |
| 0 | 16 |
| 1 | 12 |
| 2 | 8 |
| 3 | 4 |
| 4 | 0 |
उत्तर
Marginal opportunity cost is as follows:
| Good X (units) | Good Y (units) | MOC = `"ΔY"/"ΔX"` |
| 0 | 16 | - |
| 1 | 12 | 4/1 = 4 |
| 2 | 8 | 4/1 = 4 |
| 3 | 4 | 4/1 = 4 |
| 4 | 0 | 4/1 = 4 |
The above schedule clearly states that the production of Good-X increases from Unit 1 to Unit 2, and correspondingly, the units of Good-Y forgone is 4. With each additional unit of production of Good-X, the amount of Good-Y to be forgone is constant (4). So, because of constant opportunity cost, the production possibility curve (PPC) is a downward sloping straight line.
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संबंधित प्रश्न
Explain the central problem of "choice of technique".
Giving reason comment on the shape of Production Possibilities curve based on the following schedule :
| Good X (units) | Good Y (units) |
| 0 | 10 |
| 1 | 9 |
| 2 | 7 |
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What will be the impact of recently launched 'Clean India Mission' (Swachh Bharat Mission) on the Production Possibilities curve of the economy and why?
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| Good X (units) | Good Y (units) |
| 0 | 20 |
| 1 | 18 |
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| 3 | 8 |
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| Good X (units | Good Y (units) |
| 0 | 30 |
| 1 | 27 |
| 2 | 21 |
| 3 | 12 |
| 4 | 0 |
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Normal profits for a firm imply that the firm is breaking even. Explain.
