If an economy experiences increasing opportunity costs with respect to two goods,then the production possibilities curve between the two goods will be
A)Bowed outward or concave from below.
B)A straight,downward-sloping line.
C)Bowed inward or convex from below.
D)Bowed outward until the two goods are equal, and then bowed inward.

Question

Quizplus · Accepted Answer

A bowed outward or concave from below production possibilities curve indicates increasing opportunity costs. As the economy produces more of one good, the opportunity cost in terms of the other good increases, meaning that more and more units of the other good must be given up to produce each additional unit of the first good. This results in the curve becoming bowed outward or concave from below.

If an Economy Experiences Increasing Opportunity Costs with Respect to Two