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-(Figure: Production Possibilities and Circular-Flow Diagram)Use Figure: Production Possibilities and Circular-Flow Diagram.Assume the two figures represent the same economy.Suppose that in the circular-flow diagram there is a significant increase in the amount of human capital flowing to both coconut producers and fish producers.If all other variables remain unchanged,then the adjustment in this economy would be BEST represented in the production possibilities figure by a movement from point A toward:
A)point A (no movement).
B)point B (a decrease in coconut production and an increase in fish production).
C)point C (a decrease in coconut production).
D)point D (an outward shift of the entire curve).

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Use the following to answer question:

-(Figure: Production Possibilities and Circular-Flow Diagram)Use Figure: Production Possibilities and Circular-Flow Diagram.Assume the two figures represent the same economy.Suppose that in the circular-flow diagram there is a significant increase in the amount of human capital flowing to both coconut producers and fish producers.If all other variables remain unchanged,then the adjustment in this economy would be BEST represented in the production possibilities figure by a movement from point A toward:
A)point A (no movement). 
B)point B (a decrease in coconut production and an increase in fish production). 
C)point C (a decrease in coconut production). 
D)point D (an outward shift of the entire curve).

Quizplus · Accepted Answer

An increase in human capital for both coconut and fish producers means that they are more efficient in their production process, leading to an overall increase in output for both goods. This would result in an outward shift of the production possibilities curve, represented by a movement from point A to point D.

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