In using a guns and butter production possibilities curve with increasing opportunity cost, producing more and more tanks
A) Lowers the cost of each individual tank.
B) Can be done at a constant opportunity cost.
C) Requires us to give up larger and larger amounts of butter per tank produced.
D) Is not possible due to scarcity.

Question

Quizplus · Accepted Answer

With increasing opportunity cost, producing more tanks requires us to give up larger and larger amounts of butter per tank produced. This means that the production of each additional tank becomes relatively more expensive in terms of forgone butter production. Therefore, the opportunity cost of producing an additional tank increases as we move along the PPF, indicating increasing scarcity and diminishing marginal returns.

In Using a Guns and Butter Production Possibilities Curve with Increasing