1. Economic growth The following graph shows the production possibilities frontier of an economy that produces cars and computers. Suppose that a rise in this economy's savings rate allows for investment in modern, efficient manufacturing plants. Adjust the production possibilities frontier (PPF) to show the economy's new production possibilities after the rise in the savings rate. Note: Select either end of the curve on the graph to make the endpoints appear. Then drag one or both endpoints to the desired position. Points will snap into position, so if you try to move a point and it snaps back to its original position, just drag it a little farther. 24 PPF 6 QUANTITY OF CARS (Millions) PPF 10 15 QUANTITY OF COMPUTERS (Millions) Suppose society faces a broad tradeoff between allocating resources to the production of investment goods (computers) and consumption goods (cars) before the rise in the savings rate described above. Which of the following events would be most likely to lead to the rise in the savings rate you just illustrated? Decreasing production of investment and consumption goods Increasing production of investment goods and decreasing production of consumption goods Decreasing production of investment goods and increasing production of consumption goods Increasing production of investment and consumption goods