Notes on PPC
1. Straight line PPC indicates constant trade-off between good X and good Y. It implies
that the inputs in question are equally suitable in the production of X and/or Y. A bowed
shape PPC implies that inputs are not equally productive in X and/or Y.
2. The slope of the PPC is called the marginal rate of transformation or MRT, which
measures what is given up vs. what you get. It measures trade-offs. It measures the
opportunity cost of X for Y, or vice versa. It measures production substitution rate.
3. Points on the PPC represents attainable production alternatives.
4. When we are producing alo