On a straight-line production possibilities frontier, which of the following is true?
A)The problem of scarcity does not exist.
B)Resources are imperfect substitutes.
C)Opportunity costs are constant.
D)Technology is rapidly expanding.
E)Some resources are not being used efficiently.

Question

Quizplus · Accepted Answer

On a straight-line production possibilities frontier, opportunity costs are constant. This means that increasing production of one good requires sacrificing an equal amount of production of the other good. Scarcity still exists, and resources can be either perfect substitutes or imperfect substitutes. The level of technology does not necessarily impact the shape of the production possibilities frontier. Efficiency can also vary and is not necessarily implied by a straight-line production possibilities frontier.

On a Straight-Line Production Possibilities Frontier, Which of the Following