# Microeconomics Graphs.docx - Microeconomics Graphs Chapter...

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Microeconomics GraphsChapter 1Figure 1: Production Possibilities Frontier (PPF)As you move along the PPF, you can see that as you need to make more of one good you have to produce less of the other. Point A represents the maximum amount of butter. Point B represents a possibility where you create both guns and butter. Point C is the maximum amount of guns. PointD is not possible based off the current resources or technology. Point E is a waste in resourcesFigure 2: An Expanded PPFWhen the PPF moves out from the origin it is possible to reach new possibilities of production. This is most likely due to new resources being found or an increase in technology which would further the amount of output produced.
Figure 3: Possible Future PPFSociety also faces a tradeoff between current production and resource maintenance for the future.This determines what kind of production is possible in the future.Figure 5: Society’s Choice between Current Production and Resource MaintenanceThis graph shows the effect of the tradeoff shown in figure 3. If a society chooses low resource maintenance now, then they will have a lower PPF. If a society focuses on high resource maintenance, them they will have a higher PPF.
Chapter 2: Estimated Size of the 3 Spheres of Economic Activity This Graph shows the economic activity in the three spheres. Note over 40% of activity occurs outside the Business Sphere.
Chapter 7:Note there are no graphs from Chapter 7
Chapter 3The Theory of SupplyFigure 1: Supply Curve for Cups of CoffeeThis is a supply graph. At higher prices, more cups of coffee are offered for sale. This has to do with the fact that businesses want to make a profit. In this example price is the only thing changing. CETERIS PARIBUS.