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

Question

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

Quizplus · Accepted Answer

This situation illustrates increasing opportunity cost because as more resources are allocated to produce computers, the opportunity cost in terms of DVD players given up increases, indicating a bowed-out production possibilities frontier.

-As We Increase the Production of Computers, We Find That