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

Drag the production possibilities frontier (PPF) on the graph to show the effects of a breakout of avian flu that sickens millions of workers.

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.

 

(? 360 300 PPF 240 180 120 60 PPF 80 160 240 320 400 480 BARLEY (Millions of bushels) LOCOMOTIVES (Thousands)