Which of the following will shift the production possibilities curve to the right?

A. an increase in the unemployment rate from 6 to 8 percent
B. a decline in the efficiency with which the present labor force is allocated
C. a decrease in the unemployment rate from 8 to 6 percent
D. a technological advance that allows farmers to produce more output from given inputs

Question

06-09-2019
Business

contestada

Which of the following will shift the production possibilities curve to the right?

A. an increase in the unemployment rate from 6 to 8 percent
B. a decline in the efficiency with which the present labor force is allocated
C. a decrease in the unemployment rate from 8 to 6 percent
D. a technological advance that allows farmers to produce more output from given inputs

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Answer: Option (D) is correct.

Explanation:

Production possibility curve is a curve which depicts all the combination of goods that a firm can produce with the given resources. This curve shifts if there is any changes in the technology, skills and in the factor of production such as coal, oil, etc. So, if there is any improvement in the technology then as a result more goods can be produced with the same level of resources. This is due to the improvement in the farmers productivity which results from advanced technology.