15. Shifts in production possibilities

Suppose Ireland produces two types of goods: agricultural and capital. The following diagram shows its current production possibilities frontier for alfalfa, an agricultural good, and locomotives, a capital good.

Drag the production possibilities frontier (PPF) on the graph to show the effects of a time-saving innovation in the manufacturing of locomotives.

Note: Select either end of the curve on the graph to make the endpoints appear. Then drag one or both endpoints to the desired position. Points will snap into position, so if you try to move a point and it snaps back to its original position, just drag it a little farther.