Economics 9708 · AS & A Level · Production possibility curves

Production possibility curves — practice question

The diagram illustrates a production possibility curve for an economy. If the production possibility curve is assumed to stay the same, what is the most probable explanation for the shift from point X to point Y?

  • Aa civil war causing a widespread loss of resources
  • Ba permanent fall in productivity in both capital and consumer goods
  • Cthe exhaustion of a natural resource
  • Dthe rise in unemployment due to a recession

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