11 Which of the following would NOT produce an outward shift

11. Which of the following would NOT produce an outward shift of the production possibilities curve?
A. an upgrading of the quality of a nation\'s labor resources
B. the reduction of unemployment
C. an increase in the quantity of a society\'s natural resources
D. the improvement of a society\'s technological knowledge

Solution

Production possibility curve is a diagram showing different combinations of producing two commodities by using the available resources is full. It is a concave curve. On two axes two different commodities are measured. Suppose two commodities are X and Y. Their quantities are measured on horizontal and vertical axis. If you move from a point on the curve to another point on the curve but in rightward direction, then it will indicate how much unit of commodity Y you have to sacrifice for increasing quantity of X by one unit. It is slope of the curve. It is based on the assumption that inputs labor and capital are fixed. Also technology is constant.

This curve will shift to the right, then

In the problem following things are happening.

Result: Thus option B will not shift curve to the right.