O-LevelEconomicsThe basic economic problem2281/12 · Oct/Nov 2018 · Q31 Mark

The diagram shows a country's production possibility curve (PPC). Which statement is correct?

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Amovement from X to Y shows a decrease in efficiency in the economy.

Bmovement from X to Z shows a discovery of new resources in the economy.

Cmovement from Y to Z shows resources are being diverted from capital goods to consumer goods.

Dmovement from Z to Y shows an increase in efficiency in the economy.

✓ Correct answer

C: movement from Y to Z shows resources are being diverted from capital goods to consumer goods.

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Topic: The basic economic problem, O-Level Economics (syllabus 2281). Multiple choice, 1 mark.
Source: O-Level Economics, Oct/Nov 2018 Paper 1 Variant 2, question 3.

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