What is production posiblity curve .I …

Production Possibility Curve (PPC) also known as Production Possibility Frontier (PPF) is a graphical representation of all the possibile combinations of two goods that can be produced in an economy given the available resources and technology.

The two main characteristics of PPC are:

1. Slopes downwards to the right: PPC slopes downwards from left to right. It is because in a situation of fuller utilisation of the given resources, production of both the goods cannot be increased simultaneously. More of commodity A can be produced only with less production of commodity B.
2. Concave to the point of origin: It is because to produce each additional unit of commodity A, more and more units of commodity B will have to be sacrificed. Opportunity cost of producing every additional unit of commodity A tends to increase in terms of the loss of production of commodity B. Production will act upon the law of increasing marginal opportunity cost.