A lot of people died andmany factories were destroyed in an earthquake. How will it affect the PPF ot the economy?

A lot of people died andmany factories were destroyed in an earthquake

1.	A lot of people died andmany factories were destroyed in an earthquake. How will it affect the PPF ot the economy?
Answer» Solution :PPF of the economy will SHIFT to the left from PP to `P_(1)P_(1)` (REFER FIG. 1.8) It happens because the number of POSSIBLE combinations available with the economy has decreased, due to destruction of resources in the economy.