Economic growth can be shown by
A)a shift of the production possibilities curve outward.
B)a point inside the production possibilities curve.
C)movement along the production possibilities curve.
D)a shift of the production possibilities curve inward.
E)changing the shape of the production possibilities curve.

Question

Quizplus · Accepted Answer

Economic growth is shown by a shift of the production possibilities curve outward, indicating an increase in the economy's capacity to produce goods and services over time. This can be achieved through advancements in technology, an increase in the labor force, or an increase in capital stock. A point inside the production possibilities curve indicates that resources are not being fully utilized, while movement along the curve suggests a tradeoff between producing two different goods. A shift of the production possibilities curve inward would indicate a decrease in the economy's capacity to produce goods and services, while changing the shape of the curve would imply a change in the conditions of production.

Economic Growth Can Be Shown by