Exhibit 2-9

-Refer to the exhibit.At which labelled point would current production lead to the largest outward shift in the production possibilities frontier in a later year?

Question

Exhibit 2-9
 
-Refer to the exhibit.At which labelled point would current production lead to the largest outward shift in the production possibilities frontier in a later year?

Quizplus · Accepted Answer

Producing more capital goods (as represented by point c) typically leads to a larger outward shift in the production possibilities frontier in the future. This is because capital goods increase the productive capacity of an economy.

Exhibit 2-9 -Refer to the Exhibit.At Which Labelled Point Would Current Production