Economic growth can be depicted as
A) a movement up on the production possibilities curve.
B) a movement down on the production possibilities curve.
C) an outward shift on the production possibilities curve.
D) an inward shift on the production possibilities curve.

Question

Quizplus · Accepted Answer

Economic growth is typically represented as an expansion or outward shift of the production possibilities curve (PPC). This occurs when a country is able to produce more goods and services than before with the same level of resources or using the existing resources more efficiently. An upward movement along the PPC might indicate improved efficiency or productivity but not overall growth. Conversely, a downward movement along the PPC would indicate a decrease in production caused by factors such as natural disasters or war. An inward shift of the PPC would indicate a decrease in the availability or efficiency of productive resources, which may lead to a decrease in economic growth.

Economic Growth Can Be Depicted as