Login

Explain the problem of what 2 produce wid d help of ppc.

What to produce means what is produce that meet satisfied requirement of consumer Eg we have Cotton .What we produce with it A thread ,Shirt,Saree If we want to show in ppc then draw x and y axis in x show cotton saree production in unit eg 5-10-15 and in y show production of shirts in units .. eg 10-20-30 When More production of shirts their is less saree produced ....
  • -5
View Full Answer
(i) What to Produce:

Let us consider the first question: ‘which commodities are to be produced and in what quantities? The commodities which do not command positive prices in the market would not be produced. Therefore only those commodities with positive prices are to be produced and in such a way that would clear the markets.

The quantity in which a commodity is to be produced is set at that level where demand equals supply. If quality produced is more or less, then there will be dis equilibrium in the market and price will fluctuate. Hence, to maintain stable equilibrium price it becomes necessary to make demand and supply equal. This rule is applicable for each commodity. In this way, first central problem is solved.

  • -1
what to produce depends upon what product to be produced and what quantity to be produced it depends on the economy of the country whether market economy ( who prefers luxurious goods ) and socialist who prefers ( necessity good ) PPC solves this problem by sacrificing resources of luxurious goods in order to produce necessity good in socialist economy and vice versa..
  • 7
What are you looking for?