In one to two sentences, explain what happens to a production possibilities curve if a natural disaster creates a scarcity of a key resource needed to make a product. Explain why this happens.
If a natural disaster creates a scarcity of a key resource needed to make a product, the production possibilities curve will shift inward or to the left, indicating a reduction in the economy's ability to produce both goods and services due to the limited availability of the resource. This happens because the limited supply of the necessary resource hinders the production capacity and limits the range of feasible production options for the economy.
