When a society takes increasing amounts of resources and applies them to the production of a specific good, resulting in increasing opportunity costs for each additional unit produced, which of the following applies?
A) the law of demand
B) the law of supply
C) the law of scarcity
D) the law of increasing additional costs

Question

Quizplus · Accepted Answer

The situation described is an example of the law of increasing additional costs, where the more resources that are allocated to the production of a good, the higher the opportunity cost of producing additional units becomes. This is due to the limited nature of resources and increasing inefficiencies in production as more resources are allocated to a specific good. The law of demand and supply refer to the relationship between the quantity of a good produced and the price it is sold at, while the law of scarcity refers to the limited nature of resources and the need to make choices about their allocation.

When a Society Takes Increasing Amounts of Resources and Applies