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Explain how production possibility curve is affected when resources are inefficiently employed in an economy.

Asked by Nihal Singha(student) , on 15/2/14

EXPERT ANSWER
Answer given by Kanupriya is correct. For the diagram, follow the below mentioned link.
http://www.meritnation.com/cbse/class12-commerce/ncert-solutions/economics/introductory-microeconomics/introduction/page7-Exercise-qno3/338_1980_12677/what-is-aproduction-possibility-frontier
 

Posted by Vanita Rana(MeritNation Expert)on 17/2/14

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More Answers

When resources are inefficiently employed, the PPC shifts backward..

Posted by Sanjana(teacher)on 15/2/14

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when their is inefficient utilisation of resources in an economy ,there will be no effect on pp curve however production will take place under ther curve

Posted by Kanupriya Mehen...(student)on 15/2/14

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kanupriya is right... under utilisation of resources / inneffictive use of resources for example when there is unemployment or workers go on strike has NO EFFECT ON THE PPC.. rather the economy produces at a point INSIDE the PPC as the economy is NOT PRODUCING AT ITS FULL POTENTIAL. if question is 3/4 marker... make a diagram and then show the initial and final points of production

Posted by Manpreet Singh(student)on 15/2/14

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