Economic growth can be shown by ?
Correct answer: C. An outward shift of the production possibility frontier
- A. An inward shift of the production possibility frontier
- B. A movement along the production possibility frontier
- C. An outward shift of the production possibility frontier
- D. A decision by the government to produce inside the production possibility frontier
Explanation
Economic growth increases an economy’s productive capacity, so it is represented by an outward shift of the production possibility frontier. Movements along the frontier only change the combination of goods produced.
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Individual consumers, firms and markets are examined through demand and supply, elasticity, consumer choice, production, costs, revenue and the determination of prices and output. The topic also covers market structures such as perfect competition, monopoly and oligopoly, plus market failure, externalities and the distinction between microeconomic decisions and economy-wide outcomes.
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