Moving from one point on the production possibilities frontier to another
A) involves no tradeoff but it does incur an opportunity cost.
B) involves a tradeoff but does not incur an opportunity cost.
C) involves a tradeoff and incurs an opportunity cost.
D) involves an opportunity cost but no tradeoff.

Question

Quizplus · Accepted Answer

Moving from one point to another on the production possibilities frontier (PPF) involves a tradeoff because to increase the production of one good, the production of another good must decrease. This decision incurs an opportunity cost, which is the value of the next best alternative forgone as a result of making a decision.

Moving from One Point on the Production Possibilities Frontier to Another