Nearby & related entries: 1  valley of death. 2  valley of ten thousand smokes. 3  valley of the kings. 4  valley of the shadow of death. 5  valley pocket gopher. 6  valley white oak. 7  valleyfield. 8  valleys. 9  valleyspeak. 10  valleytronics.
Economics Explained: Production-Possibility Frontier. Whenever a company, factory, or even country decides to produce something, there is only so much they can make. A finite amount of capital (factories, production equipment, etc) and laborers exist, and they limit the possible amount of production. The production-possibility frontier, or PPF, is a graphical way of showing trade-offs in production choices between 2 items. If the United States decided tomorrow to produce as many loaves of bread as possible, there would be a limit to how many loaves were made.
Economic growth is the sustained expansion of production possibilities. If more capital is accumulated production possibilities increase and the PPF shifts outward. The (opportunity) cost of economic growth is that resources used to increase capital cannot be used to produce current consumption goods and services. 2013 Pearson Education, Inc. Publishing as Addison Wesley TheEconomic Problem Chapter CHAPTER CHECKLIST Chapter 3 develops an economic model, the production possibilities frontier, or PPF, model.