Question

Shift from Point A on Production Possibility Curve X₁Y₁ to Point B on X₂Y₂ in the given figure indicates:

(Choose the correct alternative) 

Options

• Decrease in resources

• Increase in resources

• Full and efficient utilisation of resources

• Wastage of resources

Answer 1

Increase in resources

Explanation:

The movement from a point on the old PPF to a point on the new PPF indicates an outward shift of the PPF, caused by an increase in resources.