1. Module The Production Possibilities Curve Model3
KRUGMAN'S
MACROECONOMICS for AP*
Margaret Ray and David Anderson

2. What you will learn in this Module:
The importance of trade-offs in economic analysis
What the production possibilities curve model tells us about efficiency opportunity cost, and economic growth
The two sources of economic growth - increases in the availability of resources and improvements in technology

3. The Production Possibilities Curve

4. Opportunity Cost - Constant

5. Opportunity Cost - Increasing

6. Economic Growth Economic growth
Expansion of the economy’s production possibilities
Availability of resources (land, labor, capital, entrepreneurship)
Technology

7. Economic Growth