Refer to the above diagram. If the production possibilities curve of an economy shifts from AB to CD, it is most likely the result of what factor affecting economic growth?

Question

Quizplus · Accepted Answer

When the production possibilities curve shifts outward (moves from AB to CD), it indicates an increase in the economy's productive capacity. This increase is most likely the result of a supply factor, such as an improvement in technology, an increase in capital or labor resources, or an expansion of natural resources. Demand, efficiency, and allocation factors may also contribute to economic growth, but they would not directly lead to an increase in productive capacity and a shift in the production possibilities curve.

Refer to the Above Diagram