A decrease in the quantity of resources
A) shifts the PPF leftward.
B) shifts the PPF rightward.
C) moves the economy up a given PPF.
D) moves the economy down a given PPF.

Question

Quizplus · Accepted Answer

A decrease in the quantity of resources will lead to a decrease in the production capacity of an economy. This will result in the production possibilities frontier (PPF) shifting leftward from its original position, indicating a decrease in the maximum possible output levels for both goods and services. Therefore, option A is the correct answer.

A Decrease in the Quantity of Resources