A nation can increase its production possibilities by:
A) shifting resources from investment good production to consumer good production.
B) shifting resources from private goods to public goods.
C) improving labor productivity.
D) reducing international trade.

Question

Quizplus · Accepted Answer

Improving labor productivity allows for more output to be produced with the same amount of resources, thus increasing the production possibilities of the nation. Choices A and B involve shifting resources, but do not necessarily increase overall productivity. Choice D reduces international trade, which can limit access to resources and markets, ultimately decreasing production possibilities.

A Nation Can Increase Its Production Possibilities By