Chapter 2 Summary of the Production Possibilities Frontier The production possibilities frontier, PPF, shows the maximum production points. Production within the production possibilities frontier is possible, but producing at a point within the frontier is the result of unemployment of factors of production or some other type of inefficiency. Hence, production points within the PPF are attainable but inefficient. Production beyond the frontier is not possible. Hence, production points beyond the frontier are not attainable. Production points on the frontier itself are both attainable and efficient. Moving from one point to another along the frontier is possible, but such a movement results in an opportunity cost. As a result, to increase the production of one product necessarily involves the sacrifice of some other product. Outward shifts of the production possibility frontier reflect economic growth. Such outward shifts of the PPF are the result of increases in the quantity or quality of inputs and/or increases in technology. It is important to note that all the points summarized above are illustrated using a two-good production possibility frontier but all are equally true in the real world with its billions of goods. The production possibilities frontier is the first economic model we have met. We'll run across many more models in the future chapters. However, because the production possibilities frontier is the first model, you probably want to be sure you completely understand it. Fortunately, the Economics in Action software that is available to help you understand the material and the Study Guide that has been written to accompany the textbook both offer lots of help. In Economics in Action work all the multiple choice questions. In the Study Guide, answer True or False questions 5, 6, 7, 8, 9, 10, 11, 12, 15, and 16; Multiple Choice questions 10, 11, 12, and 13; and Short Answer questions 2, 5, and 7. If you have studied this web page, you definitely should not miss True or False questions 7, 10, 15, and 16; Multiple Choice questions 10 and 11; and Short Answer questions 5. If you miss any of these, re-study the material. For a solid grasp of the material, you probably should miss no more than 2 or 3 of the other questions. Would you like to study another chapter?