Basic Production Possibilities Analysis The Production Possibilities model describes the limits of what a society can produce. Consider the following production possibilities, then plot, label and connect the points to form a Production Possibilities Frontier (PPF) in the figure. Production Mangoes Passion Possibility Fruit A 500 0 B 400 200 300 350 200 425 Passion Fruit 100 475 0 500 List the three main assumptions of the PPF model. a. Mangoes 1. What shape does the PPF have? (linear, concave, convex) 2. What does the shape of the PPF suggest about the opportunity cost of producing additional mangoes or passion fruit? (increases, decreases, constant) Draw point (300, 300) on your graph. Label the point G. 3. What can you say about this level of output? (obtainable, unobtainable) 4. What can you say about the use of resources? (unobtainable, efficient, inefficient)Opportunity Cost and Production Possibility Analysis Using the PPF you graphed in the figure above, what is the opportunity cost for passion fruit (in terms of mangoes per passion fruit) for each of the following moves: Move 5. 0 to 200? 6. 200 to 350? 7. 350 to 425? 8. 425 to 475? 9. 475 to 500