1. Economic models Consider the following production possibilities frontier model for an economy that produces only two goods: barley and tablets. PPF TABLETS (Millions) 0 80 100 20 40 60 BARLEY (Millions of bushels) Which of the following is true regarding this economic model? This PPF is not an economic model. . The fact that there are only two goods produced in this theoretical economy, when, in reality, economies produce many more types of goods, means this model is generally useless. . The fact that there are only two goods produced in this theoretical economy is a simplifying assumption that still allows economists to demonstrate key economic concepts. In order to construct such a model, an economist would need real life data regarding countries that only produce two goods