The graph below illustrates two production possibilities of the country of Xam.
Xam's production possibilities

Which of the following movements would represent economic growth?

Choose 1 answer:
(A) From $U$ to $Z$
(B) From $U$ to $Y$
(c) From $U$ to $W$
() From $Z$ to $V$
(ㄷ) $X$ to $Z$

Question

The graph below illustrates two production possibilities of the country of Xam.
Xam's production possibilities

Which of the following movements would represent economic growth?

Choose 1 answer:
(A) From $U$ to $Z$
(B) From $U$ to $Y$
(c) From $U$ to $W$
() From $Z$ to $V$
(ㄷ) $X$ to $Z$

Accepted Answer

∻Solution∻ ‖ a ⋮ Definition of Economic Growth: Economic growth is represented by an outward shift in the Production Possibility Curve (PPC), indicating an increase in the production capacity of an economy. ‖ ‖ b ⋮ Graph Analysis: The graph shows two PPCs, PPC1 and PPC2, with PPC2 being to the right of PPC1. This rightward shift indicates economic growth. ‖ ‖ c ⋮ Movement Analysis: The movement from point $U$ to point $Z$ does not represent economic growth as both points are on PPC1. Similarly, movements from $U$ to $W$ and $Z$ to $V$ do not represent economic growth as they are within the same PPC. The movement from $U$ to $Y$ is not provided in the graph. ‖ ‖ d ⋮ Correct Movement: The correct movement representing economic growth is from any point on PPC1 to any point on PPC2. Since the movement from $X$ to $Z$ is not provided, the correct answer is not explicitly given in the options. ‖ ∻Answer∻ ⚹ None of the provided options explicitly represent economic growth as per the given graph. ⚹ ∻Key Concept∻ ⚹ Economic growth is represented by an outward shift in the Production Possibility Curve (PPC). ⚹ ∻Explanation∻ ⚹ The graph shows two PPCs, with PPC2 being to the right of PPC1, indicating economic growth. However, none of the provided movements explicitly represent a shift from PPC1 to PPC2. ⚹◊How does economic growth impact a country's production possibilities frontier as shown in the given graph⍭ Generate me a similar question◊

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