Answer:
See the explanation below and the attached file.
Explanation:
Production Possibility Frontier (PPF) is the locus of combinations of two goods that can be produced from the given or fixed amount of resources or technology available.
Based on this definition, of the points are explained using the attached file as follows:
(a) the finiteness of resources implicit in the scarcity condition
Scarcity condition means there is finite or limited resources which limit the number or amount of things we can have or products we can produce. Production Possibility Frontier (PPF) therefore represents this scarcity. PPF therefore shows the region that is attainable and the region that is not attainable. In the attached PPF, any points A and B on the PPF are attainable while point D is not attainable given the available resource.
(b) choice
Choice refers to making decision on various combinations of two goods represented by the PPF. From the attached PPF, for example, points A or B represents the combinations of goods we can choose.
(c) opportunity cost
Movement from one point to the other like from point A to B on the attached PPF shows opportunity cost. For example, moving from point to B give us more consumer goods at the expense of less or given up some capital goods.
(d) productive efficiency
Any point on the PPF such as A or B represents productive efficiency, while any point below the PPF such as C in the attached PPF represents productive inefficiency.
(e) unemployed resources
Unemployed resources imply that the available resources are not being fully utilized. This occurs at any point below the PPF. In the attached PPF, point C which is below the PPF shows that resources are not being fully employed.
