Which of the following will shift an economy's production possibilities curve outward?
A)An improvement in technology
B)An increase in the unemployment rate
C)A decrease in land,labor or capital
D)A decrease in the unemployment rate

Question

Quizplus · Accepted Answer

An improvement in technology will increase productivity and efficiency, allowing for more goods and services to be produced with the same amount of resources. This will shift the economy's production possibilities curve outward, indicating a higher potential for economic growth and development.

B, C, and D are incorrect choices. An increase in unemployment would lead to a decrease in productive capacity, and a shift inward of the production possibilities curve. A decrease in land, labor or capital would also lead to a decreased potential for production, and a shift inward of the curve. A decrease in unemployment may improve overall economic performance, but it will not necessarily shift the production possibilities curve outward unless it is accompanied by improvements in technology or increases in resources.

Which of the Following Will Shift an Economy's Production Possibilities