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SingaporeEconomicsQuick questions
The Central Economic Problem
Quick questions on Production possibility curve explained: H2 Economics
5short Q&A pairs drawn directly from our worked dot-point answer. For full context and worked exam questions, read the parent dot-point page.
What is opportunity cost along the curve?Show answer
Moving from one point on the curve to another means producing more of one good and necessarily less of the other, because resources are fully employed. The amount of the second good given up is the opportunity cost of the extra units of the first.
What are shifts?Show answer
An outward shift of the whole curve represents economic growth: combinations once unattainable become attainable. It is caused by an increase in the quantity or quality of resources, for example a larger labour force, investment in capital, or improved technology. An inward shift represents a fall in productive capacity, for example after a natural disaster or a fall in the labour force.
What is q1?Show answer
What does a point inside the PPC represent? [2 marks]
What is q2?Show answer
Explain why moving along a PPC involves an opportunity cost. [3 marks]
What is q3?Show answer
State two causes of an outward shift in the PPC. [2 marks]
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