Question

Which of the following will not produce an outward shift of the production possibilities curve?

1) Increase in technology
2) Increase in labor force
3) Decrease in capital stock
4) Increase in education and training

Answer 1

A decrease in capital stock will not produce an outward shift of the production possibilities curve.

Step-by-step explanation:

An outward shift of the production possibilities curve represents an increase in the economy's productive capacity. Among the given options, a decrease in capital stock (choice 3) will not produce an outward shift. When capital stock decreases, the economy's ability to produce goods and services is reduced, leading to a inward shift or a movement along the production possibilities curve.