On a bowed production possibilities frontier, as you move down along the curve a. more of one good must be given up to receive one unit of the other good. b. the available production technology does not change. c. the opportunity cost increases. d. All of the above are correct.

Question

Myles Parker

Business

24 February, 00:24

On a bowed production possibilities frontier, as you move down along the curve a. more of one good must be given up to receive one unit of the other good. b. the available production technology does not change. c. the opportunity cost increases. d. All of the above are correct.

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Answers (1)

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Drew Stanton · Answer 1

The correct answer is option d.

Explanation:

A production possibility frontier shows a different combination of two goods that can be produced using all the available resources and level of technology.

As the production of one good is increased the opportunity cost of giving up its alternative goes on increasing. In other words, as we go on increasing production of one good we need to give up more of the other because of the scarcity of resources.