Figure 21 The Production Possibilities Curve

Each point on the production possibilities curve represents some maximum combination of two products that can be produced if full employment and full production are achieved. When operating on the curve, more robots means fewer pizzas, and vice versa. Limited resources and a fixed technology make any combination of robots and pizzas lying outside the curve (such as at W) unattainable. Points inside the curve are attainable, but they indicate that full employment and productive efficiency are not being realized.

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