Venya and Kari own a flower shop that specializes in custom bouquets. Wanting to expand into selling potted plants, they create
a production possibility chart to assess whether the potted plants are a good idea. Study their chart: How many potted plants should they be able to produce on Day 3? 25 30 50 75
The production possibilities frontiers measures the amount of output that a company can produce of two competing goods. This means that the company has a fixed amount of resources, and can produce a determined quantity of each of the two goods, but producing more of good x means that less resources will be available to produce more of good y.
In this example, we can suppose that for every two custom bouquets that the flower shop produces, it produces one potted plant.
If by day 3, the flower shop can produce 100 custom bouquets, then the amount of potted plants that they are able to produce is 50.
