A technological advance that increases the productivity of all inputs is best illustrated as:
A)a movement along the production possibilities curve.
B)a flattening of the production possibilities curve.
C)an inward shift of the production possibilities curve.
D)an outward shift of the production possibilities curve.

Question

A technological advance that increases the productivity of all inputs is best illustrated as:
A)​a movement along the production possibilities curve.
B)​a flattening of the production possibilities curve.
C)​an inward shift of the production possibilities curve.
D)​an outward shift of the production possibilities curve.

Quizplus · Accepted Answer

An outward shift of the production possibilities curve represents an increase in productivity of all inputs. This means that more output can be produced with the same level of inputs, or the same level of output can be produced with fewer inputs. This technological advance would allow for an expansion in the economy’s capacity to produce goods and services, leading to economic growth.

A Technological Advance That Increases the Productivity of All Inputs