Production Possibility Frontier

Page 38 to 41 of our Study Guide for 02 Intro to Econ

http://www.college-cram.com/study/economics/presentations/620

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• production
• possibility
• frontier
• ppf
• university
• of
• london
• external
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• economics
• lse
• joon
• Kang

[lauradville]

Hey Joon,

Thanks, i have to look at it a second time though, i didn have the SG in front me, but im sure it will be crystal clear when i look at it again!!! thanks

[lseexternal]

I hope it makes it clearer, because I was poring over the algebraic expression for 2 days trying to figure out how they got it!!!!

[msuzsiemusi]

Which equation to determine opportunity cost of x I should use when there are two of them? Taking self assessment question No 1 , at SG page No 51 as an example. Ive got two equations:

for labour: x+ 1/4y ≤100

for capital: 1/4x+ y ≤100

It is clear that if I will use first one it will be ¼ of y for each x, while using second we will have 4 ys for each x..