tuotantotarjontakäyrällä

The production possibility curve, or tuotantotarjontakäyrä in Finnish, is a graphical representation illustrating the possible combinations of two goods or services that an economy can produce given its available resources and technology. It assumes that resources are fully and efficiently utilized. Any point on the curve represents an efficient allocation of resources, meaning that it is impossible to produce more of one good without producing less of the other.

Points inside the curve signify inefficient production or unemployment of resources. Conversely, points outside the curve are unattainable with the current level of resources and technology. The shape of the curve is typically bowed outwards, reflecting the law of increasing opportunity cost. This means that as an economy shifts production from one good to another, it must sacrifice progressively larger amounts of the first good to gain an additional unit of the second. This occurs because resources are not perfectly adaptable to the production of all goods. The production possibility curve is a fundamental concept in microeconomics used to demonstrate scarcity, choice, and opportunity cost. It helps in understanding the trade-offs inherent in economic decision-making at both the individual and societal levels.