-Refer to Figure 2-4. If the economy is currently producing at point Y, what is the opportunity cost of moving to point W?

Question

Quizplus · Accepted Answer

If the economy is producing at point Y and moves to point W, it means the economy is moving to a point on the production possibilities frontier (PPF) where resources are fully utilized. Since point Y is inside the PPF, moving to point W does not incur an opportunity cost as it represents a more efficient use of resources without sacrificing the production of other goods.