A nation can increase its production possibilities by
A) shifting resources to produce more consumer goods and less investment goods.
B) shifting resources from private goods to public goods.
C) improving labor productivity.
D) eliminating unemployment.

Question

Quizplus · Accepted Answer

Improving labor productivity means that workers can produce more output with the same amount of resources, which increases the nation's overall production possibilities. Shifting resources to produce more consumer goods may lead to short-term increases in output, but in the long-term, investment in capital goods may be necessary to sustain economic growth. Shifting resources from private goods to public goods may have social benefits but may not necessarily increase overall production possibilities. Eliminating unemployment may lead to more efficient use of resources, but it depends on the type of unemployment (cyclical or structural) and may not directly increase production possibilities.

A Nation Can Increase Its Production Possibilities by