Question

Which of the following is likely to cause an inward shift in country's PPC?

• A. Earthquake destroying resources of the country.
• B. Scientists discovering new machines.
• C. Workers getting jobs in the new metro project.
• D. The country finds new reserves of crude oil.

Answer 1

Answer: (A)

Earthquake destroying resources of the country.

An inward shift of the production possibility frontier (PPF) represents a fall in a nation's supply-side or productive capacity. One cause could be the effects of natural disasters such as drought, earthquakes or severe floods which destroy built-up capital and potentially causes significant loss of life