Final answer:
Investing in renewable energy sources can shift a country's PPC outward, indicating potential for greater economic output without sacrificing environmental quality. This shift reflects the reduced opportunity cost of incorporating sustainable practices into production.
Step-by-step explanation:
If a country invests heavily in renewable energy sources, leading to more efficient and sustainable production processes, it would likely affect the Production Possibility Curve (PPC) for goods and services by shifting it outward. This is because renewable energy sources such as wind, hydroelectric power, and solar are cleaner and more sustainable, thereby potentially increasing the economic well-being of a country without sacrificing environmental quality. Since renewable energy may also lead to lower energy costs in the long term, this can enhance productivity and the ability to produce a greater combination of goods and services.
Investments into renewable energy infrastructure can help to reduce the opportunity cost of environmental protection, because energy from these sources typically has fewer negative environmental impacts compared to fossil fuels. With the advent of renewable energy technology improvements, the assumption that a high level of environmental protection necessarily requires a sacrifice in economic output may become less valid, thereby shifting the PPC outward and reflecting a new set of attainable possibilities for the country.