Like AD, AS can shift.
One way is that the full employment output could improve, in one of three ways:
- It could get more factors of production
- Its factors of production might become higher quality
- Existing factors might be used more efficiently
In other words, the quantity, quality or efficiency of use of factors of production in the economy might improve, because this is what determines the position of the PPF.
Come up with some examples of how this might happen using the grid and then pen tool or drag and drop the cards to the correct place on the grid