Increasing opportunity cost exists
A) in the real world.
B) for a country but not for an individual.
C) inside the PPF but not on the PPF.
D) only in theory but not in real life.
E) as long as there is high unemployment.

Question

Quizplus · Accepted Answer

Increasing opportunity cost exists in the real world, as resources are not infinitely available and must be allocated between different goods and services. As more of a good is produced, the opportunity cost of producing an additional unit increases as resources that are best suited for that good are used up and less suitable resources are utilized. This is illustrated by the bowed-out shape of the production possibilities frontier (PPF).

Increasing Opportunity Cost Exists