Inward Shift of Production Possibilities Frontier (PPF)

Steps:

• Identify the curve as a PPF, showing maximum output combinations with fixed resources and technology.
• Recognize that an inward shift (to NP) occurs when resources or productivity decrease, reducing potential output.
• Evaluate each option's impact on resources, technology, or efficiency.
• Select the option that directly reduces available labor resources.

Why A is correct:

• A fall in the working population decreases labor resources, shifting the PPF inward per the resource constraint in PPF theory.

Why the others are wrong:

• B: Reallocation moves along the existing PPF, not shifting it.
• C: Increased unemployment causes production inside the PPF, not a shift.
• D: Higher employment per worker boosts productivity, shifting PPF outward.

Final answer: A