Question

What is depicted by the concave shape of the production possibilities curve?

A Law of increasing opportunity cost Correct Answer Incorrect Answer
B The production is inefficient Correct Answer Incorrect Answer
C The production is unattainable Correct Answer Incorrect Answer
D The demand is relatively elastic Correct Answer Incorrect Answer

Solution

The bowed-out shape of the production possibilities curve signifies increasing opportunity costs as resources are reallocated between goods, highlighting the trade-offs inherent in resource allocation.

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