Question

Suppose a small country produces only food and clothing. A new agricultural technology is then introduced that doubles the amount of food that can be produced per year.

Use the​ 3-point-curve drawing tool to draw a new production possibilities boundary on the graph on the​ right, labeled​ b, reflecting the change in the agricultural technology. Properly label this line. Place end points one on horizontal and one on vertical axes.

Answer 1

The initial production possibility curve is shown by PPC t. When there is a new technology that increases the amount of food generated, there will be an outward change in PPC along the food axis. The new PPC is now b.