A country's feasible production frontier for consumer goods (vertical axis) and capital goods (horizontal axis) is a curve that is bowed outwards from the origin. Consider two potential shifts in production, both of which involve increasing the output of capital goods by the exact same amount (e.g., by 100 units).
- Shift 1: Moving from a point where many consumer goods and few capital goods are produced.
- Shift 2: Moving from a point where fewer consumer goods and many capital goods are alrea
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Evaluating a Production Model
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A country's feasible production frontier for consumer goods (vertical axis) and capital goods (horizontal axis) is a curve that is bowed outwards from the origin. Consider two potential shifts in production, both of which involve increasing the output of capital goods by the exact same amount (e.g., by 100 units).
- Shift 1: Moving from a point where many consumer goods and few capital goods are produced.
- Shift 2: Moving from a point where fewer consumer goods and many capital goods are alrea
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