Exhibit 2-18 Production possibilities curves
In Exhibit 2-18, a country is located at point A on its Year X production possibilities curve. In Year Y this same country is located at point B on its Year Y production possibilities curve. Which of the following could have brought about this outward shift in production possibilities curves?
A. More efficient production in Year X.
B. A natural disaster in Year X which leads to a destruction of resources.
C. Higher unemployment in Year X.
D. An advance in technology occurred in Year X.
Answer: D
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