The diagram below shows the production possibility frontier (PPF) for an economy producing Electric Vehicles (EVs) and Internal Combustion Engine (ICE) vehicles.
If the economy's production shifts from Point U U\,U to Point VVV, which one of the following statements must be true?
The economy's productive potential has increased.
Productive efficiency in the automotive sector has improved.
Allocative efficiency is guaranteed to be achieved at Point VVV.
The opportunity cost of increasing Electric Vehicle production has remained constant during this movement.
