Figure 2.2
-Figure 2.2 presents a production possibilities curve for a country that can either produce highways or provide people with medical care in a given year. The figure shows that as more highways are built, the opportunity cost of building each additional highway is:

Question

Quizplus · Accepted Answer

The production possibilities curve in Figure 2.2 is concave, which means that the opportunity cost of producing each additional highway is increasing. This is because as more highways are built, resources that are better suited for medical care production are being diverted to highway production, resulting in diminishing returns to highway production and an increasing opportunity cost. Therefore, the best choice is to produce a lower quantity of highways and a higher quantity of medical care, where the opportunity cost is lower.

Figure 2.2 -Figure 2.2 Presents a Production Possibilities Curve for a Country