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A production possibilities frontier line of sofas versus cars. The origin of the axis system is at (0, 0). The line starts on the Sofas
A production possibilities frontier line of sofas versus cars. The origin of the axis system is at (0, 0). The line starts on the Sofas axis at the maximum feasible value, then descends in a straight line to the maximum feasible value for cars on the Cars axis. Representative points are as follow. (0, 900), (200, 600), (400, 300), (600, 0). Four points, A, B, C, and D, are plotted as follows. Point A is at the maximum feasible value for sofas, (0, 900). Point B is on the production possibilities frontier at (200, 600). Point C is on the production possibilities frontier at (400, 300). Point D is is at the maximum feasible value for cars, (600, 0). Refer to Figure 2-6. Consider the production possibilities frontier for an economy that produces only sofas and cars. When society moves from point A to point B, the opportunity cost is the same as when society moves from point B to point C. it is giving up cars to get sofas. the opportunity cost is increasing. it moves from an inefficient point to an efficient point
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