If the production possibilities curve were a straight downsloping line, this would suggest that:
A)resources are perfectly substitutable between the production of these two goods.
B)it is possible to produce more of both products.
C)both products are equally capable of satisfying consumer wants.
D)the two products have identical prices.

Question

Quizplus · Accepted Answer

If the production possibilities curve is a straight downsloping line, it suggests that the two goods being produced are perfect substitutes for each other. This means that the resources used to produce one good can be easily switched to produce the other good without any decrease in efficiency. Therefore, the production possibilities curve would be a straight line, indicating that the opportunity cost of producing one good in terms of the other is constant throughout the production range.

If the Production Possibilities Curve Were a Straight Downsloping Line