Central problems and PP curve. PP curve helps in solving central problems of an economy as explained below.
What to produce: In fact different points on PP curve depicting different combinations of two goods (like B, C, D, E in Fig) are different choices that are open to society. It is from these choices that society has to select one with the objective of achieving maximum social welfare. For instance, if the society decides to produce more of wheat and less of tanks, it is likely to choose combination E. Conversely if it requires more of tanks, it may choose combination B or C on PP curve in Fig. In short PP curve offers various options to society in the form of different combinations of goods to choose from according to its needs and thus helps solve the problem of 'what to produce'.