Explain Production possibility curve.
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Production Possibility Curve (PPC)
The PPC is a graphical representation of the maximum output combinations of two goods that an economy can produce given its resources and technology, assuming all resources are fully and efficiently utilized.
It is typically concave to the origin, reflecting the law of increasing opportunity costs. As more of one good is produced, increasingly larger quantities of the other good must be sacrificed due to resource specialization.
Points on the curve represent efficient production levels, inside the curve indicate underutilization of resources, and outside the curve are unattainable with current resources.