Economics

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How does increasing or decreasing the quantity of capital goods produced this period affect next period's production possibilities curve and why?

The only thing I can think of is that if more products are produced this period, less can be produced next period because their are less resources used and if less goods are produced this period, more can be produced next period because less resources have been used. So, if more goods are produced the production possibilities curve moves to the left anf if less goods are produced the curve moves to the right. I do not know why though...

Is this right? I am slightly confused with this whole concept...PLEASE HELP!

  • Economics -

    see my post above.

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