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

Question

Quizplus · Accepted Answer

Moving from one point to another on the production possibilities frontier involves reallocating resources from the production of one good to another, which constitutes a tradeoff. This reallocation also incurs an opportunity cost, as producing more of one good results in the loss of potential production of another good.

Moving from One Point on the Production Possibilities Frontier to Another