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Exhibit: Strawberries and Submarines

-(Exhibit: Strawberries and Submarines) As the economy moves from point A towards, say, point D, it will find that the opportunity cost of each additional submarine:
A) falls.
B) rises.
C) remains unchanged.
D) none of the above

Question

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Exhibit: Strawberries and Submarines
 
-(Exhibit: Strawberries and Submarines) As the economy moves from point A towards, say, point D, it will find that the opportunity cost of each additional submarine:
A) falls. 
B) rises. 
C) remains unchanged. 
D) none of the above

Quizplus · Accepted Answer

According to the exhibit, as the economy moves from point A towards point D, the opportunity cost of each additional submarine rises. This is because the production of submarines requires the diversion of resources from producing strawberries, which have a higher opportunity cost as the economy moves along the production possibility curve towards the production of more submarines.

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