The table below sets out the production possibilities of a small Pacific island economy. An economy allocates its resources to the production of two commodities: Consumer and Military products. Possibility A Military products (thousands of units) Consumer products (thousands of units) 0 20 2 18 4 15 11 6 10 0 A Illustrate the economy's PPF on the graph and explain how production possibilities curve can be used to explain the problem of scarcity B. Explain the shape of this economy's PPF C. Describe the concept of efficiency based on the Production possibilities curve. Indicate efficient and inefficient points on the graph.c D. Calculate the opportunity cost of increasing the production of military goods when the economy is moving from the point D to the point E CELCBY В D F 6 8

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Laffer Curve Analysis

In terms of economics, the Laffer curve was popular among those economists who were or who belonged to the supply side of the economic peripheral.  This concept was popularized by the famous supply-side economist known as Arthur Laffer. This curve illustrated the relationship between the tax rates and government revenue. It is already known that the tax which the public or individuals residing in an economy bear is the revenue or income of the government with the help of which the government does all the necessary works in the society, which is beneficial for the economy.