Figure 2-2 Figure 2-2 above shows the production possibilities frontier for Vidalia,a nation that produces two goods,roses and orchids.
-Refer to Figure 2-2.The linear production possibilities frontier in the figure indicates that

Question

Figure 2-2  Figure 2-2 above shows the production possibilities frontier for Vidalia,a nation that produces two goods,roses and orchids.
-Refer to Figure 2-2.The linear production possibilities frontier in the figure indicates that

Quizplus · Accepted Answer

The linear production possibilities frontier indicates that the tradeoff between roses and orchids is constant. This means that the opportunity cost of producing one good in terms of the other remains the same throughout the production possibilities frontier. Therefore, there is no comparative advantage or disadvantage in producing either good, and it is not progressively more expensive to produce one good over the other.

Figure 2-2 Figure 2-2 Above Shows the Production Possibilities