Outward PPC Shift from Technological Progress

Steps:

• Production possibility curve (PPC) shows maximum output combinations with fixed resources and technology.
• Outward shift from PPC1 to PPC2 means increased productive capacity for both goods.
• Possible causes include more resources (e.g., labor) or better technology.
• Evaluate options: prices and employment changes affect demand or resource quantity, but technology directly boosts efficiency.

Why D is correct:

• Technological increase raises productivity, allowing more output from same inputs, per the definition of PPC shifts in economic models.

Why the others are wrong:

• A: Price decreases influence consumer demand, not production frontiers.
• B: Employment decrease reduces labor resources, causing inward PPC shift.
• C: Employment increase adds resources and could shift PPC, but does not match the technology-driven growth implied here.

Final answer: D