In a production possibilities curve, what does a shift to the left imply?

A shift to the left in a production possibilities curve indicates that an economy is producing less of one or both of the goods represented on the graph. This movement reflects a decline in the economy's overall production capacity or resources. Various factors can contribute to this decline, such as an economic recession, where overall economic activity decreases, or reduced efficiency in the use of available resources.

For an economy, a leftward shift may signify several adverse conditions. For example, if a significant portion of the workforce becomes unemployed or industrial output decreases due to factory closures, the economy would be able to produce fewer goods and services overall. This decrease in production translates into lower levels of employment, income, and economic welfare for the population.

Understanding the implications of a leftward shift is fundamental in economics, as it provides insight into the health of the economy and the efficiency with which its resources are being utilized. Thus, option B accurately captures the meaning behind this shift in the production possibilities curve.