Enter the change in y and the change in x of a PPF (production possibilities frontier) curve into the calculator to determine the slope.

PPF Formula

The following formula is used to calculate the opportunity cost of any good using the slope of a PPF line.

OC = (Y1-Y2) / (X1-X2)

  • Where OC is the opportunity cost
  • Y1 and Y2 are two Y points along the PPF line
  • X1 and X2 are two corresponding X coordinates on the same line

PPF Definition

PPF, short for production possibilities frontier, sets a combination of goods and services a society can produce given what resources they have available.

Two display this, a PPF curve is often graphed. Choices outside the slope are “impossible” and choices inside the slope are inefficient.

Example Problem

How to calculate PPF slope?

  1. First, determine two y coordinates along the slope.

    For this example, the y coordinates are y1=5, Y2=10.

  2. Next, determine the two corresponding x coordinates.

    For this problem, the x coordinates are x1=3, x2=12

  3. Finally, calculate the PPF slope:

    Using the formula above, the PPF slope is calculated to be:
    OC = (Y1-Y2) / (X1-X2)
    OC = (5-10) / (3-12)
    OC = -5 / -9
    OC = .555