-The figure above shows the production possibilities frontier for a country.How does the opportunity cost of compact cars forgone per SUV gained moving from point C to point B compare with the movement from point B to point A?
A) The opportunity cost of moving from point C to point B is greater than the movement from point B to point A.
B) The opportunity cost of moving from point C to point B is the same as the movement from point B to point A.
C) The opportunity cost of moving from point C to point B is less than the movement from point B to point A.
D) The opportunity costs cannot be compared because the units of moving from point C to point B differ from the units of moving from point B to point A.
E) More information is needed to determine how the two opportunity costs compare.

Question

-The figure above shows the production possibilities frontier for a country.How does the opportunity cost of compact cars forgone per SUV gained moving from point C to point B compare with the movement from point B to point A?
A) The opportunity cost of moving from point C to point B is greater than the movement from point B to point A. 
B) The opportunity cost of moving from point C to point B is the same as the movement from point B to point A. 
C) The opportunity cost of moving from point C to point B is less than the movement from point B to point A. 
D) The opportunity costs cannot be compared because the units of moving from point C to point B differ from the units of moving from point B to point A. 
E) More information is needed to determine how the two opportunity costs compare.

Quizplus · Accepted Answer

The opportunity cost typically increases as you move along a production possibilities frontier due to the law of increasing opportunity costs. Thus, moving from point B to point A likely involves a higher opportunity cost than moving from point C to point B.

-The Figure Above Shows the Production Possibilities Frontier for a Country.How