A nation's current location on its production possibilities curve can determine the future location of that nation's production possibilities curve.

Question

Quizplus · Accepted Answer

If a nation is currently producing at its highest possible level of efficiency, it may need to invest in new technology or resources in order to shift its production possibilities curve outward and increase its potential for future production. Alternatively, if a nation is currently producing below its potential due to inefficiencies or underinvestment, it may experience a downward shift in its production possibilities curve in the future. Therefore, a nation's current location on its production possibilities curve can impact its ability to produce in the future.

A Nation's Current Location on Its Production Possibilities Curve Can