(19-21] Refer to the information provided in Figure 2.3 below to answer the ques
ID: 1132204 • Letter: #
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(19-21] Refer to the information provided in Figure 2.3 below to answer the questions tha ppf2 ppf1 Consumer goods Figure 2.3 19. Refer to Figure 2.3. Economic growth is represented by a A) shift from pp2 to ppf B) shift from ppfl to ppf2. C) movement along ppfl D) movement along ppf2. 20. Refer to Figure 2.3. Which of the following will not cause the production possibility frontier to shift from ppfi to ppf2? A) the discovery of previously unknown oil fields B) an improvement in technology C) an increase in the stock of capital D) a decrease in the unemployment rate 21. Refer to Figure 2.3. Which of the following will not cause the production possibility frontier to shift from ppfi to ppf? A) An unexpected mild spring results in a bumper crop of citrus fruit in both Florida and California, B) A change in immigration laws significantly increases the number of immigrant workers entering the country C) An innovation in desalinization technology allows for the more efficient conversion of salt water to fresh water D) A radiation leak at a nuclear power plant results in the long-term evacuation of a 10,000 square-mile area, which significantly reduces the nation's productive capacityExplanation / Answer
19) In the construction of production possibility Frontier, economic growth can be defined as an increase in the resources or upgradation in the technology which shifts the production possibility Frontier outwards. Therefore a shift of the PPF from PPF1 to PPF2 will be called to have shown economic growth. Option B
20) Option D because as against the other three options, decrease in unemployment rate does not influence the PPF.
21) Option D for the same reason. It shifts PPF inside.
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