Production Possibility Frontier (PFF)

A Production Possibility Frontier (PPF) is a graphical representation that illustrates the maximum possible output combinations of two goods or services that an economy can achieve when all resources are fully and efficiently utilized, given the existing levels of technology.

The curve demonstrates trade-offs and Opportunity Costs, showing how increasing the production of one good requires decreasing the production of another.

For example, consider an economy that produces only two goods: guns and butter. The PPF would show the maximum quantities of guns and butter that can be produced with available resources. If the economy is at a point on the curve, it is operating efficiently