On a production possibilities frontier showing possible output levels of good A and good B, the opportunity cost of producing the first 10 units of A will usually be
A)the same as the opportunity cost of producing the second 10 units of A
B)less than the opportunity cost of producing the second 10 units of A
C)greater than the opportunity cost of making the second 10 units of A
D)10 units of A
E)10 units of B

Question

Quizplus · Accepted Answer

The opportunity cost of producing additional units typically increases due to the law of increasing opportunity costs, which states that resources are not perfectly adaptable to the production of both goods. Thus, the opportunity cost of the first 10 units of A is usually less than that of the second 10 units.

On a Production Possibilities Frontier Showing Possible Output Levels of Good