As we increase the production of computers, we find that we must give up larger and larger amounts of DVD players per computer.
A) DVD players will be more highly regarded by consumers than computers.
B) This situation illustrates increasing opportunity cost.
C) The production possibilities frontier for computers and DVD players is a straight line.
D) As a result, we should specialize in the production of DVD players.

Question

Quizplus · Accepted Answer

Increasing opportunity cost is demonstrated through this scenario because as the production of computers increases, the opportunity cost in terms of the production of DVD players also increases. This means that for each additional computer produced, more and more DVD players must be given up, indicating a tradeoff between the two goods. The other choices are not supported by the information given.

As We Increase the Production of Computers, We Find That