The law of increasing opportunity costs states that:

Question

Quizplus · Accepted Answer

The law of increasing opportunity costs states that as an economy produces more of one good, the opportunity cost of producing each additional unit of that good increases. This occurs because the resources best suited for producing the first units of that good are used up, so resources that are less efficient at producing that good must be used, resulting in a higher cost. As a result, the production possibilities frontier is bowed outward, indicating that the opportunity cost of producing a good increases as more of it is produced.

The Law of Increasing Opportunity Costs States That