How are the following events likely to affect an economy's production possibilities curve?
a. An increase in the working population of the economy
b. The import of better production technology
c. A natural disaster that destroys some of the economy's resources
d. Emigration of workers to other countries
a. An increase in the working population of the economy implies an increase in the amount of resources available for production in the economy. Hence, the production possibilities curve will shift rightward.
b. The import of better technology implies that more can be produced with the amount of resources available in the economy. Hence, the production possibilities curve will shift rightward.
c. A natural disaster that destroys some of the resources available for production will lead to an inward shift of the production possibilities curve. This is because fewer resources are now available for production purposes.
d. If workers migrate to other countries, fewer workers will be available for domestic production. This will cause an inward shift in the economy's production possibilities curve.
You might also like to view...
What was the most immediate impact of introducing the horse to the plains Indians?
a. A decrease in the amount of agricultural work the Indians did b. A large increase in the size of hunting groups c. More intensive and more efficient use of animal carcasses. d. More time was spent in fixed locations
Free trade leads to an overall improvement in the standard of living in a country because everything is produced at the lowest possible cost
a. True b. False Indicate whether the statement is true or false