The following table contains some production possibilities for an economy for a given month.

If the production possibilities frontier is bowed outward,then "?" could be
A) 50.
B) 75.
C) 100.
D) 125.

Question

The following table contains some production possibilities for an economy for a given month.

If the production possibilities frontier is bowed outward,then "?" could be
A) 50. 
B) 75. 
C) 100. 
D) 125.

Quizplus · Accepted Answer

Since a bowed out PPF indicates increasing opportunity cost, the only way to produce 125 units of X is by giving up a significant amount of Y, resulting in a higher opportunity cost. Therefore, 125 is the maximum output possible and the best choice.

The Following Table Contains Some Production Possibilities for an Economy