Table 2-3

-Refer to Table 2-3. Based on the values in the table, the production possibilities frontier is
A)bowed outward indicating increasing opportunity costs.
B)bowed outward indicating decreasing opportunity costs.
C)a straight line indicating constant opportunity costs.
D)bowed inward indicating increasing opportunity costs.

Question

Table 2-3
​
 
-Refer to Table 2-3. Based on the values in the table, the production possibilities frontier is
A)bowed outward indicating increasing opportunity costs. 
B)bowed outward indicating decreasing opportunity costs. 
C)a straight line indicating constant opportunity costs. 
D)bowed inward indicating increasing opportunity costs.

Quizplus · Accepted Answer

The production possibilities frontier (PPF) is bowed outward when there are increasing opportunity costs. This shape indicates that as you produce more of one good, the opportunity cost (in terms of foregone production of the other good) increases.

Table 2-3 ​

Table 2-3