Figure 2.2
-Figure 2.2 presents a production possibilities curve for a given year for a country that can either produce highways or provide people with medical care.The figure shows that as more highways are built,the opportunity cost of building each additional highway is

Question

Quizplus · Accepted Answer

The figure shows a bowed-out shape of the production possibilities curve, indicating increasing opportunity costs. As more highways are produced, the resources required for their production are increasingly specialized, and thus the opportunity cost of producing one additional unit of highways increases. This implies that the country has to give up more and more medical care for each additional highway. Therefore, the correct answer is (B) increasing.

Figure 2.2 -Figure 2.2 Presents a Production Possibilities Curve for a Given