A decrease in the unemployment rate will shift an economy's production possibilities curve outward.

Question

Quizplus · Accepted Answer

The production possibilities curve (PPC) represents the maximum output combinations of two goods that an economy can produce with available resources and technology. A decrease in the unemployment rate does not shift the PPC outward; instead, it moves the economy closer to its existing PPC by utilizing idle resources.

A Decrease in the Unemployment Rate Will Shift an Economy's