Answer:
Explanation:
Certainly! Here's the effect of each situation on the Production Possibility Curve (PPC):
a) **Massive unemployment due to natural calamities:**
- Effect on PPC: The PPC would shift inward (to the left).
- Explanation: Natural calamities causing massive unemployment reduce the labor force available for production. This decreases the economy's productive capacity, leading to a contraction in the PPC.
b) **Swachh Bharat mission:**
- Effect on PPC: The PPC might shift outward (to the right).
- Explanation: Improving cleanliness and sanitation can enhance public health, reduce disease burden, and increase labor productivity. This improvement in human capital and efficiency can lead to an expansion in the economy's productive capacity, thereby shifting the PPC outward.
c) **Transfer back of black money from other countries to India:**
- Effect on PPC: The effect is indirect and depends on how the money is used.
- Explanation: If the black money is effectively utilized for productive investments in the economy, such as infrastructure or industries, it can potentially increase productivity and expand the PPC. However, if misused or not properly invested, its impact on the PPC may be negligible.
d) **"Make in India" offer by the Prime Minister:**
- Effect on PPC: The PPC might shift outward (to the right).
- Explanation: Promoting domestic manufacturing under "Make in India" aims to increase industrial production and reduce dependency on imports. This can lead to an expansion of the economy's productive capacity, shifting the PPC outward.
e) **Fall in price of crude oil in the international market:**
- Effect on PPC: The PPC might shift outward (to the right).
- Explanation: Lower oil prices reduce production costs for industries dependent on oil and decrease input costs for consumers. This can lead to increased profitability, higher disposable income, and overall economic growth, resulting in an outward shift of the PPC.
f) **A large-scale outflow of foreign capital by investors:**
- Effect on PPC: The PPC would shift inward (to the left).
- Explanation: Foreign capital outflows reduce investment levels in the economy, leading to decreased economic activity, lower production capacity, and a contraction in the PPC.
These explanations illustrate how various economic and policy-related factors can influence the position and movement of the Production Possibility Curve (PPC) in an economy.
