Which of the following reasons might explain why an economy would be - ProProfs Discuss
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Which of the following reasons might explain why an economy would be operating inside its production possibilities curve (PPC)?



A. Because shrinking population has reduced the number of productive workers in the economy.
B. Because technological innovations have increased the productivity of labor and capital.
C. Because damage to natural resources, such as might be caused by deforestation leading to erosion of topsoil, has shrunk the land resource.
D. Because of unemployment or underemployment of labor, perhaps due to discrimination against employing workers of a certain race or gender.

This question is part of Production Possibilities Practice Quiz
Asked by Wyatt Williams, Last updated: Jun 29, 2020

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2 Answers

m.guszak

M.guszak

Answered Jan 05, 2017

D. is the correct answer. C sounds good, but the factors described in C. would cause the PPF to shift inside. You would be operating on your PPF, not inside it.
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John Smith

John Smith

Answered Nov 01, 2016

Because of unemployment or underemployment of labor, perhaps due to discrimination against employing workers of a certain race or gender.
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