Question

4 Shifts in production possibilities Suppose the Netherlands produces two types of goods: agricultural and capital. The following diagram shows its current production possibilities frontier for alfalfa, an agricultural good, and airplanes, a capital good Drag the production possibilities frontier (PPF) on the graph to show the effects of an immigration law that resuits in fewer workers entering the country Note: Select either end of the curve on the graph to make the endpoints appear. Then drag one or both endpoints to the desired position. Points will snap into position, so if you try to move a point and it snaps back to its original position, just drag it a little farther 40 T 400 PPF 300 2no 100 PPF 100 200 0 0 600 ALFALFA (Milions of bushels)

Answer 1

The immigration law that prohibits the entry of the worker will reduce the leve of production in the economy. Therefore, the PPF curve will shift inward.