Sweden has a mixed economic system. In 2018, it was operating at a point inside its production possibility curve (PPC). In 2018, the country's schools employed nearly 2500 extra teachers. A few of these had previously been actors. A higher number had previously been government officials involved with regulation of Swedish monopolies. Explain the difference between a point inside a PPC and a point outside a PPC.

Economics
IGCSE&ALevel
CAIE
Exam No:0455_m21_qp_22 Year:2021 Question No:5(b)

Answer:

Logical explanation which might include:
A point inside indicates unemployed resources (1) inefficient
use of resources / wasted resources (1) output is below
potential output (1) an attainable point (1).
A point outside is unattainable (1) not enough resources /
beyond productive potential / only achievable with more
resources / only achievable with better quality resources / not
achievable with current resources / will be possible with future
economic growth (1).

Knowledge points:

1.4.2 The significance of the location of production points. points under, on and beyond a PPC

Solution:

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