Opportunity cost is evident on the production possibilities frontier (PPF)graph:
A) as you move from one point on the frontier to another point on the frontier.
B) as you move from the origin to any inefficient point.
C) as you move from one unattainable point to an efficient point on the frontier.
D) as you move from an inefficient point to the origin.
E) at any one single point on the graph.

Question

Quizplus · Accepted Answer

As you move along the PPF from one point to another, the opportunity cost of producing one good in terms of the other becomes evident. This is because the resources used to produce one good are not available for producing the other good, and thus, as we produce more of one good, we have to give up the production of some units of the other good. This tradeoff is reflected in the slope of the PPF, which measures the opportunity cost between the two goods.

Opportunity Cost Is Evident on the Production Possibilities Frontier (PPF)graph