Figure 3-2

-Refer to Figure 3-2. The fact that the line slopes downward reflects the fact that
A)for Venezuela, it is more costly to produce peanuts than it is to produce cashews.
B)Venezuela will produce more peanuts and fewer cashews as time goes by.
C)Venezuela faces a trade-off between producing peanuts and producing cashews.
D)Venezuela should specialize in producing cashews.

Question

Figure 3-2
 
-Refer to Figure 3-2. The fact that the line slopes downward reflects the fact that
A)for Venezuela, it is more costly to produce peanuts than it is to produce cashews. 
B)Venezuela will produce more peanuts and fewer cashews as time goes by. 
C)Venezuela faces a trade-off between producing peanuts and producing cashews. 
D)Venezuela should specialize in producing cashews.

Quizplus · Accepted Answer

The downward slope of the line in the figure indicates a trade-off, meaning that to produce more of one good (e.g., peanuts), Venezuela must produce less of the other good (e.g., cashews). This reflects the concept of opportunity cost in economics.

Figure 3-2 -Refer to Figure 3-2. the Fact That the Line Slopes