An outward shift of the Production Possibilities Curve (PPC) indicates that an economy has become less efficient in resource allocation and production capacity.

An outward shift of the Production Possibilities Curve (PPC) actually means that an economy has become more efficient, not less. This shift shows that the economy can produce more goods and services than before, indicating an increase in resources or improvements in technology. For example, if a country develops a new technology that allows farmers to grow more crops on the same amount of land, the PPC will shift outward because the country can now produce more food. This shift reflects better use of resources and greater production capacity, allowing the economy to meet the needs of its people more effectively. So, an outward shift is a positive sign of growth and efficiency, not a decrease in resource allocation.