Chapter 40, Problem 6MCQ

To determine

The correct option for a movement of a point from below PPC to the PPC curve.

Answer to Problem 6MCQ

Option c is correct.

Explanation of Solution

Explanation for the correct option:

c.

Using PPC, long-run economic growth can be shown by outward shift. If a point is moved from below PPC to the PPC curve, then it means it is depicting more efficiency and economic growth. Therefore, option c is correct.

Explanation for incorrect options:

a.

If a point is moved from below PPC to at the PPC, then it is showing increased efficiency.

b.

Economic expansion is shown if the point lies out of the PPC curve.

d.

Increased unemployment would not let the point move to the PPC curve from below the PPC level.

e.

An economic recession occurs when the point has moved from the PPC curve to the point below the PPC curve.

Economics Concept Introduction

Production Possibilities Curve: The production possibility curve refers to the curve that represents the possible production of two products that requires similar resources.