If the production possibilities frontier between two goods were a straight line,then the opportunity cost of one good in terms of another would be
A) constant.
B) increasing.
C) decreasing.
D) zero.
E) either constant, increasing, or decreasing but more information is needed to determine which.

Question

Quizplus · Accepted Answer

If the production possibilities frontier (PPF) between two goods is a straight line, it means that the opportunity cost of one good in terms of another is constant. This is because the slope of a straight line is constant at every point, which represents the rate of tradeoff between the goods. Therefore, if the economy wants to produce more of one good, it must give up a constant amount of the other good. This constant rate of tradeoff implies a constant opportunity cost of one good in terms of another.

If the Production Possibilities Frontier Between Two Goods Were a Straight