The production possibility curve is bowed outward from the origin because of:

Question

Quizplus · Accepted Answer

The production possibility curve is bowed outward due to the law of increasing opportunity costs, which states that as production of one good increases, the opportunity cost of producing an additional unit of this good increases. This is because resources are not equally efficient in all uses, so reallocating resources to different uses changes the opportunity cost.

The Production Possibility Curve Is Bowed Outward from the Origin