The production possibilities curve for the nation of Economania shifts to the right. This could have been caused by:

Question

Quizplus · Accepted Answer

An improvement in the health and skill level of Economania's workforce would likely lead to an increase in productivity, causing the production possibilities curve to shift to the right. Decreases in capital stock (A) or labor supply (B) would likely lead to a leftward shift in the curve. High unemployment (C) may lead to a shift in the short run, but in the long run, it would not affect the productive capacity of the economy.

The Production Possibilities Curve for the Nation of Economania Shifts