Figure 3-2

-Refer to Figure 3-2.A decrease in productivity would be represented by a movement from
A)A to B.
B)B to A.
C)S₁ to S₂.
D)S₂ to S₁.

Question

Figure 3-2
 
-Refer to Figure 3-2.A decrease in productivity would be represented by a movement from
A)A to B. 
B)B to A. 
C)S₁ to S₂. 
D)S₂ to S₁.

Quizplus · Accepted Answer

A decrease in productivity means there is a decrease in the amount of output that can be produced with a given set of inputs. This would cause a shift from S₁ to S₂ because the production possibilities curve shifts inward due to the decreased productivity. Therefore, the correct choice is D, which represents the shift from S₂ to S₁.

Figure 3-2 -Refer to Figure 3-2.A Decrease in Productivity Would Be Represented