The diagram below shows two production possibilities boundaries for Country X.
FIGURE 1-4
-Refer to Figure 1-4.Growth in the countryʹs productive capacity is illustrated by
A)a point like D outside the boundary.
B)a movement from a point inside the boundary such as C to the boundary.
C)the movement between points on a given boundary.
D)a single point such as A on the boundary.
E)an outward shift of the boundary,for example from PPB1 to PPB2.

Question

The diagram below shows two production possibilities boundaries for Country X.
  FIGURE 1-4
-Refer to Figure 1-4.Growth in the countryʹs productive capacity is illustrated by
A)a point like D outside the boundary. 
B)a movement from a point inside the boundary such as C to the boundary. 
C)the movement between points on a given boundary. 
D)a single point such as A on the boundary. 
E)an outward shift of the boundary,for example from PPB1 to PPB2.

Quizplus · Accepted Answer

The growth in the country's productive capacity is illustrated by an outward shift of the production possibilities boundary, for example from PPB1 to PPB2. This signifies an increase in the potential output of both goods, indicating that the economy has become more efficient or has experienced an increase in its resource base.

The Diagram Below Shows Two Production Possibilities Boundaries for Country