What is the difference between production possibilities frontiers that are bowed out and those that are linear?
A)Bowed out production possibilities frontiers illustrate tradeoffs where linear production possibilities frontiers do not.
B)Bowed out production possibilities frontiers show increasing opportunity cost where linear ones show constant opportunity cost.
C)Bowed out production possibilities frontiers are the result of perfectly shiftable resources where linear production possibilities frontiers are not.
D)Linear production possibilities frontiers illustrate real world conditions more than bowed out production possibilities frontiers.

Question

Quizplus · Accepted Answer

Bowed out production possibilities frontiers show increasing opportunity cost where linear ones show constant opportunity cost. This means that as we produce more of one good, we have to give up increasingly larger amounts of the other good. Linear production possibilities frontiers do not show this relationship, as the opportunity cost remains constant regardless of how much of either good is produced.

What Is the Difference Between Production Possibilities Frontiers That Are