An outward shift of the production possibilities curve demonstrates
A) a recession.
B) an increased rate of inflation.
C) economic growth.
D) a cyclical shock.

Question

Quizplus · Accepted Answer

An outward shift of the production possibilities curve means that the economy is able to produce more goods and services than before. This indicates an increase in the economy's potential output, which is generally the result of economic growth driven by factors such as technological advancement or increased capital investment.

An Outward Shift of the Production Possibilities Curve Demonstrates