The bowed-outward shape of a PPF
A) is due to the existence of increasing opportunity cost.
B) reflects the unequal application of technology in production.
C) illustrates the fact that no opportunity cost is incurred for increasing the production of the good measured on the horizontal axis but it is incurred to increase production of the good measured along the vertical axis.
D) is due to capital accumulation.

Question

Quizplus · Accepted Answer

The bowed-outward shape of a PPF is due to the existence of increasing opportunity cost. This means that as more and more of one good is produced, greater and greater amounts of the other good must be given up. This results in a curve that bows outward, indicating that the opportunity cost of producing one good increases as more of that good is produced.

The Bowed-Outward Shape of a PPF