Production Possibilities

Production Possibility Curve graphs show various production possibilities and how product output will be affected if production increases/decreases are made. These graphs help us see the best choices available to maximise production and make the most from our scarce resources.

An example of how scarcity and choices this has affected my personal life would be our current landscaping project. We had to choose between hiring a landscaper or doing the work ourselves. Our choice was affected by both scarcity of time and money, and we had to base our decision off of what we place more value on. In the end, we decided both were equally important and chose to hire a landscaper to do part of the work therefore saving ourselves time and do the remaining work on our own which saved money.

ProductionPossibility Curve graphs also show visual examples of how opportunity costs work. The curve shows that in order to get more of one product, we must trade-off another product. An example of a significant opportunity cost would be my choice to return to school. Although school costs me both time and money, it will provide a long term benefit by helping my further my career. I had to decide the long-term value of school was worth the trade-off.