Suppose an economy produces only two types of goods, agricultural goods and manufactured goods. This makes intuitive sense as straight lines have a constant slope. Here's the straight frontier line again. It shows that Econ Isle can produce a maximum of 12 gadgets and 6 widgets or any other combination along the line. Note that since the tradeoff between cars and grain is constant, the production possibilities frontier is a straight line. D) there are no opportunity costs. In this case, the production possibilities frontier is a straight line. ª Concave PPFs show increasing opportunity costs. Overview. Letâs review the production possibilities frontier and focus more specifically on the shape of the curve. In business and economics, the production possibility frontier (PPF)âalso called the production possibility curve (PPC) or the transformation curveâvisualizes the different possible quantities of two different goods that may be produced when there is limited availability of a certain resource that both need to be produced. This point shows widget production increased by 2, and this by 2 more, and this by 2 more, indicating all widgets and no gadgets. A production possibility frontier that is a straight line sloping down from left to right would suggest that: A) more of both goods could be produced moving along the frontier. If an economy instead faces a constant opportunity cost of one producing one of the goods, the production possibilities frontier would be represented by a straight line. The shape of the PPF depends on whether there are increasing, decreasing, or constant costs. This graph shows the production possibilities frontier for the rancher. 7. A production possibility frontier (PPF) shows the maximum amount of goods and services which an economy can produce with its existing resources at existing factor productivity. In business analysis, the production possibility frontier (PPF) is a curve illustrating the varying amounts of two products that can be produced when â¦ A production possibilities frontier: A) shows how participants in the market are linked B) shows the maximum attainable combinations of two goods that may be produced with available resources C) shows the act of buying and selling D) shows the market for a good or service E) shows how unlimited wants exceed the limited resources available to fulfill those wants So along the straight line, each time Econ Isle increases widget â¦ Figure 3. c. The production possibility curve becomes steeper as more of the good on the horizontal axis is produced because production of additional units of that good incurs increasing opportunity costs. A production possibility frontier that is a straight line sloping down from left to right suggests that: A) more of both goods could be produced moving along the frontier. B) the two products must have the same price. The Production Possibilities Frontier (PPF) is a graph that shows all the different combinations of output of two goods that can be produced using available resources and technology. The PPF captures the concepts of scarcity, choice, and tradeoffs. Even if it put all of its resources (land, labour, capital and enterprise) into making agricultural goods, there must be a â¦ B) â¦ C) the opportunity costs of the products are constant. ª The reciprocal of the opportunity cost shows the oppositeâthe opportunity cost of the second good in terms of the first one. 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