Question

What will be the impact of large scale outflow of foreign capital on production possibilities curve on the economy?

Answer 1

A large scale of the outflow of the foreign capital would lead to the reduction in the resources available to an economy.

The decline in resources would rather lead further to a decline of the country’s overall capacity.

This will lead to a downward shift in the production possibilities curve because now the economy will produce less of both commodities.

Answer 2

Answer:

Explanation: outflows of foreign capital lead to decrease in resources in the county . This would decrease country economy then ppc will shift leftwards