Refer to the figure below and assume that the values for points a, b, and c (the
combined value of consumer goods and capital goods) are $20 billion, $40 billion, and
$28 billion, respectively.
The Macroeconomy
Capital goods
PPF₂
PPF,
Instructions: Enter your answers as a whole number.
a. If the economy moves from point a to point b over a 2-year period, what must have
been its annual rate of economic growth?
percent
Consumer goods
b. If, instead, the economy was at point c at the end of the 2-year period, by what
percentage did it fall short of its production capacity?
percent