Increasing relative costs are the result of

Question

Quizplus · Accepted Answer

Relative costs increase when resources are not perfectly adaptable for alternative uses. This means that the opportunity cost of using a resource for one purpose increases as the resource becomes more scarce or in higher demand for other uses. High taxes or an increase in production do not necessarily lead to a rise in relative costs. The statement in option D is also incorrect as the efficient use of resources can lead to lower relative costs.

Increasing Relative Costs Are the Result of