12. Assuming the PPF is shifting from PPFo to PPFn, which of the following explains the cause or causes of the economic growth depicted in this Figure? a) This Figure represents growth due to an increase in resources and/or improvement in technology that are specific to the production of X. b) This Figure represents growth due to an increase in resources and/or improvement in technology that are specific to the production of Y. c) This Figure represents growth due to an increase in resources and/or improvement in technology that are not specific to either product. d) This Figure represents growth due to an increase in specialization.
12. Assuming the
a) This Figure represents growth due to an increase in resources and/or improvement in technology that are specific to the production of X. |
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b) This Figure represents growth due to an increase in resources and/or improvement in technology that are specific to the production of Y. |
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c) This Figure represents growth due to an increase in resources and/or improvement in technology that are not specific to either product. |
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d) This Figure represents growth due to an increase in specialization. |
The reason for the outward shift of the PPF is the increase in technology or the increase in resources. If the total amount of factors of production increases, both goods can be produced. If advanced technologies are discovered, those same goods can be produced with fewer production factors. Hence, this growth and advancement are not related to specific good but is overall. Any change will benefit the production of both goods directly and indirectly.
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