MOD-1.C—Explain (using graphs as appropriate) how the PPC is related to the long-run aggregate supply (LRAS) curve

Explain (using graphs as appropriate) how the PPC is related to the long-run aggregate supply (LRAS) curve.

• An outward shift in the PPC is analogous to a rightward shift of the long-run aggregate supply curve. [See LO MOD-2.I]
• Enduring understanding MOD-1: The production possibilities curve (PPC) model is used to demonstrate the full employment level of output and to illustrate changes in full employment.