Will it be true, false, or uncertain ?if people who was laid off return back to work that according to the productive possibility graph with a shift outward/right that butter and guns would increase. Explain.

Question

Will it be true, false, or uncertain ?if people who was laid off return back to work that according to the productive possibility graph with a shift outward/right that butter and guns would increase.  Explain.

economyst · Answer

False.

The production possibilities frontier (ppf) shows the maximum possible production when all resources are used efficiently. So, hiring unemployed workers should have no effect on the PPF. However, acquiring new workers through, say births or immigration, would increase the PPF.