Increasing opportunity cost while moving along a production possibilities frontier is the result of
A) the fact that it is more difficult to use resources efficiently the more society produces.
B) the fact that resources are not equally productive in alternative uses.
C) firms' needs to produce profits.
D) taxes.

Question

Quizplus · Accepted Answer

Increasing opportunity cost while moving along a production possibilities frontier is the result of the fact that resources are not equally productive in alternative uses. As more of a good is produced, resources specialized in producing that good become increasingly scarce in relation to the other goods, and therefore can be used more productively elsewhere. This leads to a higher opportunity cost of producing more of that good.

Increasing Opportunity Cost While Moving Along a Production Possibilities Frontier