Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question
Expert Solution
Step 1
i) Explanation
A technological breakthrough in the economy is defined as the advancement in technology or progress. Any technological advancement increases the efficiency of the production process. It means the firm can produce more units of goods in the existing level of factors of production. So technological advancement shift the PPF curve rightward. According to question only technological breakthrough happen in good X, so bet satisfying PPF would be Figure (3).
Answer
(3)
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