When a production possibilities frontier is bowed outward, the opportunity cost of the second good in terms of the first good increases as more of the second good is produced.

Question

Quizplus · Accepted Answer

This is because a bowed-outward production possibilities frontier (PPF) indicates increasing opportunity costs. As more of the second good is produced, more of the first good must be given up, reflecting the principle of increasing opportunity costs.

When a Production Possibilities Frontier Is Bowed Outward, the Opportunity