Since producers must be compensated for the rising opportunity cost that accompanies increases in output,
A) the law of demand applies to most markets
B) supply curves usually slope downward
C) demand curves usually slope downward
D) supply curves usually slope upward
E) technical inefficiency would not exist in the long run

Question

Quizplus · Accepted Answer

According to the law of increasing opportunity cost, as the production of a good increases, the opportunity cost of producing that good also increases. Therefore, producers must be compensated for the rising opportunity cost that accompanies increases in output. This implies that the supply curve usually slopes upward to reflect the higher cost of producing additional units.

Since Producers Must Be Compensated for the Rising Opportunity Cost