PPC Eco

Effects on PPC due to various
Government policies
BY
KHUSI KHATUN
CLASS- XI
ROLL NO.- 04
1
1. Acknowledgement
2. Introduction
3. Effect on PPC due to GST
4. Effect on PPC due to Demonetisation
5. Effect on PPC due to Clean India mission
6. Effect on PPC due to Skill India mission
7. Effect on PPC due to Massive unemployment
8. Effect on PPC due to Digital Mission
9. Shapes of PPc
I feel highly privileged and honoured in making the project on
EFFECT ON PPC DUE TO VARIOUS GOVT. POLICES. I
express my sincere gratitude to my teachers, parents and my
friends for their kind cooperation for preparing this project. My
special thanks to my teacher MISS PARUL MAM for her
continuous support and encouragement that led to the
development of this material. I would also like to thank our
principal MR K.C. DAS sir for his caring and encouraging
attitude towards us.
I look forward to receive valuable suggestions from teachers,
students.
Thank you
 A PRODUCTION
POSSIBILITY CURVE(PPC)
or PRODUCTION
POSSIBILITY
FRONTIER(PPF) shows the
graphical presentation of the
various combination of two
goods that can be produced
with available technologies
and given resources.
Production possibility curve is a diagrammatic
representation showing alternative production possibilities
of to goods with the given resources and technique of
production it is also called production boundary Or
production Frontier as it shows the maximum possible
production with the given resources.
It is also called transmission line or Transformation
curve because it indicates that if more of good-X is to be
produced then factors of production will have to be
withdrawn from the production of Good – Y and transfer
to the production of good-X. In other words good-Y is
transformed into good-X it refers to a
Diagrammatical representation showing various
combinations of two goods which can be produced within
given resources and Technology.
For example suppose an economy decides to produce only
two goods namely, wheat and cloth with its available
resources and given Technology if all the resources are used
for the production of wheat alone than 100 lakh tonnes of
wheat can be produced on the contrary if all the resources
are used for the production of cloth alone than 4000 bales of
cloth can be produced if the economy produces both the good
then within these limits, various combinations of two goods
can be produced
PPC can be shifted rotated in certain conditions.
1. If resources are increased or decreased the PPC shifts
2. If techniques is improved the PPC shifts or gets rotated.
EFFECT OF GOVERNMENT POLICIES:-

There can be a good effect or bad effect of different
government policies on PPC. It is based on which policies
will make production more or which will make production
less.
Due to different policies of government the PPC can be
shifted rightwards or leftwards it can also be rotated if
technique will be improved due to certain policies.
Production possibility curve will undergo a rightward
shift. The reason for that is:-
goods and service tax has an edge over the erstwhile
indirect taxation system with regards to input tax credit.
Previously while tax calculation the tax payer got input
Credit only for the excise service and VAT production it
means if CST, customs or any other indirect taxes are
payable during sale no credit On such taxes could be set
off against The similar taxes paid during purchase of
inputs for production. Unlike it, GST has optimal
provision for availing input tax credit, which has made
GST cost efficient. Consequently, capital goods became
cheaper than before causing multi-fold increase in
domestic as well as foreign direct investment this has
increase the production possibility curve the statement of
an increase in investment is backed by the post GST
statistical evidence of gross fixed capital formation that
increase from 1.6% in quarter 1 To 4.3% in quarter 2
In short run the point will shift inside PPC because of the
removal of taxes and supplier will decrease production
in long run there will be an increase in foreign investment
which would Increase GDP and PPC will shift to the right.
All the points on the PPC depict Efficient outcomes that is
we are reducing exactly the amount which can be produced
by the fixed number of resources but that’s an ideal case
We are obviously inside the area of feasible but inefficient
outcomes because it’s very difficult to have all the
outcomes as efficient.
 There are two scenarios
1. in short run since the society was depending on cash
for a long time,
There purchasing power decreases because of
demonetisation decreases industries which cannot change
there supply immediately will have inelastic supply and
some other will have a bit elastic relative to to others overall
it will be a less efficient outcome compared to previous one.
2. In long run however the growth rate will increase
because society will be moving towards a cashless
society which will lead to more buying hence more
production. The production will Definitely increase in
the long run.
Moreover, better Technology can also come in the long run
positively reinforcing the effect to the about in long run
So in long run the outcome is expected to move
Rightwards.
PPC in the long run shift right words thereby expanding
the economy due to increase employment higher demand,
more foreign currency inflow from tourist, better picture
of India in the world, higher ranking, multiplier effects
etc.
There are two types of resources human resources and
physical resources clean India mission will obviously have
a positive impact on our society as it will lead to increase
efficiency in human resource.
Eco-friendly environmental conditions and sanitation
will enhance the quality of human resource and will
increase productivity and the overall output.
Hence it will lead to to a rightward shift in PPC curve of
the country.
Government make in India campaign Aims at
transforming the country into a global manufacturing
Hub and has already made tremendous impact on the
investment climate as evidenced by the growth in foreign
direct investment.
So when Investments increases by make in India
campaign it will make PPC shift right word as production
will increase it represents economic growth.
Economic growth is an increase in what an economy can
produce if it is
Using all its starts resources an increase in an economics
productive potential can be shown by and outward shift in
The Economies production possibility curve.
On micro level if make in India goes well then it will
increase in employment rate more quantity of supplied
goods lower prices for consumers multiplier boost to
economy Etc.
Skill development programs like skill India Are aimed at
human capital formation that is it increases the capacity
and skill of human resources.
So with the same amount of resources we can produce
more goods and services in the economy due to improve
skills.
Suppose you have an unskilled worker from Village if
you train that person on productive jobs skill India then
he walks in a more efficient manner then before and can
produce more Goods and services with his
Improve skills and hence it promotes economic growth.
When we improve the skills off existing Workforce
productivity increases economic growth happens and PPC
shift right words
Massive unemployment in a country will be reflected on
go PPC as underutilization of resources are lying idle
when they could have been used for some productive
purposes like farming Manufacturing Etc.
Massive unemployment is a situation of Wastage Human
resources which means there is an under utilization of
resources and in this case PPC will not shift anywhere but
this point lies within the PPC.
 Digital India programme will lead to Improvement in
technology better technology in the sense of improved
online infrastructure and internet connectivity will
increase the production capacity of the economy
accordingly the PPC will shift to Right. Impact of
demonetization in India effect PPC off India in short
term PPC off India shift to left words in India everyone
is not aware about internet banking of online payment
people Face Money problem and do not use fully utilized
resources in short period. It’s cause PPC shift to left
words.
1. Concave:- It is due to increasing MOC. It means that in
order to produce more of units of X, more of units of Y are
sacrificed or rate of sacrifice increases. It is due to
application of law of diminishing returns.
2. Convex:- It is due to decreasing MOC. It mean that in order
to produce more of units of commodity X, less unit of
commodity Y are sacrificed. This is because of law of
increasing returns.
3. Straight:- This is due to constant MOC. In order to produce
more of unit X(clothes),same unit of good Y(food) are
sacrificed remained constant. This is because law of
constant return.
Therefore, all the government policies have some what
effect on PPC which can make it shift right words or
leftward. We can used various government policies to
make production easier faster and greater.
Policies like GST skill India mission clean India mission
help the PPC To rise and generate production of goods
The information of the topic is taken from:
1. Qoura.com
2. Google.com
3. Meritnation.com
And from the book prescribed by cbse i.e. Introductory
microeconomics

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Effects on PPC due to various

EFFECT OF GOVERNMENT POLICIES:-

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