Question

what does a production possibilities frontier show

Answer 1

it shows what a producer can and cannot make.

Anything INSIDE the curve shows an inefficient use of resources.

Anything ON the curve shows a 100% efficient use of resources.

Anything OUTSIDE the curve is impossible to produce based on available resources/capabilities.

Answer 2

each axis represents a different good/service. So it also shows the opportunity cost (cost in terms of another good or service) of producing one or the other good.

Answer 3

Hello @heyman,
That's a good question. The PPF or production possibility frontier shows the state of an economy and the resources it has and there is a limit to them. That would mean only certain amounts of goods and services can be produced- only a few combinations.

Answer 4

the maximum combination of goods able to be produced,
increasing production of one item along the curve will always lessen the production of the other, unless technology or resources change.