What happens to the Production Possibility Frontier (PPF) when productivity only increases in one good?

We start here with an initial PPF which shows the possible combinations of apples and computers that an economy can produce with the resources it has. If a new way of creating computer chips makes the computer industry more productive and the apple farming industry is unaffected, then the PPF will move out in the direction of computer production, but not in apple production.

Answered by Matthew D. Economics tutor

4636 Views

See similar Economics A Level tutors

Related Economics A Level answers

All answers ▸

Can you explain the difference between RPI and CPI inflation?


Explain why deflation may not always be a problem


Using a diagram, explain how an economy's exchange rate is determined. 4 marks. AS Level The National and International Economy


Discuss the possible impact of supermarket monopsony power on both food suppliers and consumers?


We're here to help

contact us iconContact usWhatsapp logoMessage us on Whatsapptelephone icon+44 (0) 203 773 6020
Facebook logoInstagram logoLinkedIn logo

© MyTutorWeb Ltd 2013–2024

Terms & Conditions|Privacy Policy