If the production possibilities frontier between two goods were a straight line, then the opportunity cost of one good in terms of another would be
A) constant.
B) zero.
C) increasing.
D) decreasing.
E) either constant, increasing or decreasing, but more information is needed to determine which.

Question

Quizplus · Accepted Answer

If the production possibilities frontier between two goods were a straight line, it means that the opportunity cost of one good in terms of another is constant. This is because resources are perfectly adaptable to the production of both goods in one-to-one ratios, meaning that the quantity of resources required to produce one good is constant no matter how much of the other good is being produced. Therefore, the opportunity cost remains the same for every unit of one good that is produced, making it constant.

If the Production Possibilities Frontier Between Two Goods Were a Straight