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Consider the following: "At the beginning of 1940, the United States economy was characterized by substantial unemployment. The Soviet economy at that time, however, was operating at fullemployment. By the end of the year, the US economy had moved to a full-employment, increasing its output of both civilian and military goods with a technological improvement in military goods production. The Soviet economy was still at full-employment at year's end, but producing many fewer civilian goods and many more military goods than at the beginning of the year". Use two separate production possibilities frontier (PPF) diagrams of the US and Soviet economies to illustrate and explain these historical events.

Microeconomics, Economics

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