On April 25th 2015, Nepal was hit by an earthquake, that killed more than 8,800 people and injured more than 23.000 people. The earthquake was estimated to be between 7.1-7.9 on the Richterscale, depending on the source. Following the first earthquake, there came several aftershocks. The worst of the aftershocks, occurred on May 12th 2015, and was 7,3 on the Richterscale.
Nepal were already in a very bad economical situation, and have been for a very long time. Nepal’s unemployment rate is 25,2% and their GDP per capita is as 426.48 USD, but Nepal was under big development - but the damages of the earthquake could easily pause that development.
How has Nepal been affected
A Production possibility curve shows all maximum output possibilities for two goods given a set of input. The PPC assumes that all inputs are used efficiently.
PPC1 shows what the PPC would look like if all inputs are used efficiently. But that is almost impossible to achieve. With the damages done to the agriculture, because that a lot of the ground has been damaged, the maximum output can not be achieved and because the things used to produce the manufactured goods, come from agriculture, the PPC will move inwards, as shown in PPC2.
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