Economic growth may be represented by:
A) A movement from one end of the production possibilities curve to the other
B) An upward-sloping production possibilities curve
C) A movement from a point inside to a point on the production possibilities curve
D) A rightward shift of the production possibilities curve

Question

Quizplus · Accepted Answer

Economic growth refers to an increase in a country's economic output over a period of time. This can be represented by a rightward shift of the production possibilities curve, as this indicates an increase in the amount of goods and services that can be produced in the economy. A movement from one end of the production possibilities curve to the other (A) represents a movement from inefficient to efficient production, but does not necessarily indicate overall economic growth. An upward-sloping production possibilities curve (B) simply indicates that the opportunity cost of producing one good increases as more of it is produced, but does not necessarily indicate economic growth. A movement from a point inside to a point on the production possibilities curve (C) represents an increase in the efficiency of production, but again, may not necessarily indicate overall economic growth.

Economic Growth May Be Represented By