Final answer:
A nation's production possibilities curve can shift outward when production techniques improve, often due to technological innovations or increased efficiency. An example of technological advancement is the Green Revolution, which significantly increased crop yields and shifted the supply curve right. Accordingly, an economy can afford more goods as it grows.
Step-by-step explanation:
A nation's production possibilities curve can shift outward through the use of improved production techniques. This outward shift represents an economy's increased ability to produce more goods and services. It is often achieved through technological innovation, such as the development of new machinery, or improvement in processes that enhance the efficiency of production. The Green Revolution is an example where breeding improved seeds for crops like wheat and rice significantly increased the harvest per acre, effectively shifting the supply curve to the right. This means that more of the goods can be produced at any given price point, reflecting an increase in supply due to advanced technology.
Improving efficiency and using resources optimally, as well as the expansion of resources over time, like more labor and capital, can lead to an economy growing. This growth is demonstrated by an outward shift of the production possibilities frontier as the economy can now afford more of all goods.