Maximum possible combinations of food and clothing that can be produced in a given period of time:

Units of food (millions) Units of clothing (millions)
8.0 0.0
7.0 2.2
6.0 4.0
5.0 5.0
4.0 5.6
3.0 6.0
2.0 6.4
1.0 6.7
0.0 7.0

a. Draw a PPF for this economy.

b. What is the opportunity cost of moving from producing 4 million units of food to 5 million units of food?

c. What is the opportunity cost of moving from producing 6 million units of clothing to 7 million units of clothing?

d. What is the opportunity cost of switching production from 0 units of food to 2 million units of food?

e. What shape is the PPF curve in this example? Explain in your words why it is this shape.

f. In what circumstances would the PPF be a straight line?

g. Could a PPF be bowed towards the origin?