For a farm producing two crops and operating on the Production Possibilities Frontier (curve) where revenue is maximized, a change in the price of a third output will:

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Quizplus · Accepted Answer

The Production Possibilities Frontier (PPF) represents the maximum output combinations of two goods that a farm can produce given its resources and technology, and it is not directly affected by changes in the price of a third output not considered in the PPF. Similarly, changes in the price of a third output do not directly increase the costs of production for the two crops on the PPF. The isorevenue line, which represents combinations of the two goods that yield the same revenue, is also not directly shifted by changes in the price of a third, unrelated output.

For a Farm Producing Two Crops and Operating on the Production