What is production possibility curve?

Question: What is production possibility curve?

A production possibility curve (PPC) is a graphical representation of the different combinations of two goods that can be produced using a given amount of resources and technology. The curve shows the maximum possible output of one good for any given output level of the other good, assuming that all resources are fully utilized and technology is held constant. The PPC demonstrates the concept of opportunity cost, as producing more of one good requires giving up some of the production of the other good. The shape of the curve is typically bowed outward, indicating that the opportunity cost of producing one good increases as more of it is produced.

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