<P> A production--possibility frontier (PPF) or production possibility curve (PPC) is a the possible tradeoff of producing combinations of goods with constant technology and resources per unit time . One good can only be produced by diverting resources from other goods, and so by producing less of them . This tradeoff is usually considered for an economy, but also applies to each individual, household, and economic organization . </P> <P> Graphically bounding the production set for fixed input quantities, the PPF curve shows the maximum possible production level of one commodity for any given production level of the other, given the existing state of technology . By doing so, it defines productive efficiency in the context of that production set: a point on the frontier indicates efficient use of the available inputs (such as points B, D and C in the graph), a point beneath the curve (such as A) indicates inefficiency, and a point beyond the curve (such as X) indicates impossibility . </P> <P> The PSU represented by the point on the PPF where an efficient economy operates (which is obtained by tangency with the highest individual or social indifference curve, not shown in the graph) presents the priorities or choices of the modeled agent, such as the choice of having more butter produced and fewer guns, or vice versa . </P>

All points on the production possibilities frontier represent