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Economics · May / June 2026 · Paper 11 · Question 3

2281Production possibility curve (PPC) diagrams

A country's production possibility curve (PPC) shifts from PPC1 to PPC2 and the economy's output moves from point X to point Y. What has happened in this country?

  1. Athe opportunity cost of capital goods has increased
  2. Beconomic growth has occurred
  3. Cthe production of consumer goods has increased
  4. Dunemployment has fallen

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Correct answer: B. economic growth has occurred

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