The Figure Given Below Shows a Shift in the Production-Possibility

question 38

Multiple Choice

The figure given below shows a shift in the production-possibility curve of a country from AB to AC. Here, S₁ and C₁ are the initial production and consumption points respectively. S₂ and C₂, on the other hand, are the final production and consumption points respectively. Which of the following is illustrated by this figure?

• A)The mechanism of reversal in trade pattern
• B)The validity of the product cycle hypothesis
• C)The immiserizing growth effect in a large country
• D)The benefits of trade in a small country

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Definitions:

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