Labor Supply Reduction Shifts PPC Left

Steps:

• Production possibility curve (PPC) shifts left when an economy's productive capacity decreases, often due to reduced resources like labor.
• Assess each option's impact on labor supply or efficiency, assuming ceteris paribus.
• Options increasing labor supply or productivity shift PPC right; only reductions shift it left.
• Increase in school leaving age delays workforce entry, shrinking labor supply.

Why D is correct:

• Higher school leaving age extends education, reducing available workers and thus total productive capacity, per the PPC definition of resource constraints.

Why the others are wrong:

• A: Boosts labor supply via more immigrants, expanding capacity.
• B: Extends working years for older workers, increasing labor supply.
• C: Raises output per worker, enhancing efficiency and capacity.

Final answer: D