Lab
Draw the PPC
Every situation starts with the same economy making capital goods and consumer goods. Label both axes first. Then either choose what happens to the curve or drag the point to where it belongs, and check your graph.
Challenges
- Before you check each change, say what happens to the most capital goods and the most consumer goods the economy can make.
- Find the situation where the curve stays put. What changes instead?
- Put the point exactly on the curve, then move it straight down. What does the economy give up, and why is nothing gained?