Answer to Question #75910 in Economics for Sibongile

Question

A community in Northern Namibia produces only two goods, TVs and CDs. With the aid of properly labelled production possibilities curves illustrate each of the following (putting TVs on the vertical axis). 2.1.1 A shift in production from CDs (services) towards TVs (goods). (5) 2.1.2 An increase in the potential output of the community due to a greater availability of the factors of production.

Answer 1

2.1.1 It is anticipated that a shift in production from CDs (services) towards TVs (goods) will result in a movement along the curve.
2.1.2 It is expected that an increase in the potential output of the community due to a greater availability of the factors of production will lead to shift of PPC outwards (to the right).