An increase in output can be achieved in two basic ways.
The first scenario: Aggregate demand increases, so supply extends. In this way the economy is making more use of its resources, but there is still spare capacity, and productive potential hasn't increased.
The second scenario: Aggregate supply increases. National output increases without demand increasing and productive potential of the country has increased.
Now I know that the second scenario is economic growth for sure, as economic growth is generally characterised by an increase in the productive potential of country. But is the first scenario also economic growth? That is, is it called economic growth if a country just makes use of more resources already available to satisfy increased demand?
Furthermore, can the first scenario be shown on a PPC? Perhaps a shift from a point within the curve to a point on the curve?