If an economy's production possibility frontier is negatively sloped and "bowed outward" from the origin, then the opportunity cost of producing a good
A) increases as more of that good is produced.
B) decreases as more of that good is produced.
C) remains constant as more of that good is produced.
D) remains constant as less of that good is produced.

Question

Quizplus · Accepted Answer

A "bowed outward" production possibility frontier indicates increasing opportunity costs as more of a good is produced, due to the law of increasing opportunity costs. This law states that as you produce more of one good, the opportunity cost (in terms of foregone production of another good) increases.

If an Economy's Production Possibility Frontier Is Negatively Sloped and "Bowed