Hamburger- Needed land to produce the cow to produce the beef instead of alternative uses, crops to feed the cow, Labor- a butcher for the beef, capital-human capital to produce the beef and physical capital such as trucks hauling the cows/beef back and forth. Everything produced has a cost associated to it, so there is no such thing as a free lunch.2.The Production Possibilities Frontier- Any point on the PPF represents an efficient use of scarce factors of production. Labor, Land, Capital, Technology. Points inside the PPF represents an inefficient use of scarce resources, such as unemployed resources. Points outside of the PPF are unattainable given the existing scarce factors of production.3.The Production Function- Relates the level of labor input to output. Given amount of Land, Capital and Technology. Such as, as we add labor, we add output. Whenever Land, Capital or Technology change, such as in an upward direction, the whole production function will shift upward. We are going to use the Production Function when we talk about the supply side of the economy.
2.1 Production Possibilities Frontiers and Opportunity Costs, pages 38-43SummaryThe Production Possibilities Frontier (PPF) is a curve that shows the maximum attainable combinations of two products that may be produced with available resources. The PPF is used to illustrate the trade-offs that arise from scarcity. Points on the frontier are technically efficient. Points inside the frontier are unattainable. The