Question
If production involves constant opportunity cost, the production possibilities frontier
a. is “bowed inward.”
b. is a straight line.
c. is “bowed outward.”
d. has an unpredictable shape.
e. is a wavy line.
a. is “bowed inward.”
b. is a straight line.
c. is “bowed outward.”
d. has an unpredictable shape.
e. is a wavy line.
Ask by Blake Schofield. in the United States
Mar 21,2025
Upstudy AI Solution
Tutor-Verified Answer
Answer
The production possibilities frontier is a straight line when there’s constant opportunity cost.
Solution
Since production with constant opportunity cost implies that resources are equally efficient in producing either good, the trade-off between the two goods is constant. Mathematically, if we produce goods
where
Thus, the correct answer is:
b. is a straight line.
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Simplify this solution Mind Expander
If production involves constant opportunity cost, the production possibilities frontier is represented by a straight line. This linear shape indicates that the trade-off between the two goods is constant, meaning that for every unit of one good produced, a fixed amount of the other good must be foregone.
In real-world scenarios, constant opportunity costs can be seen in industries where resources can be easily redirected from the production of one product to another without losing efficiency, such as in manufacturing where machines can produce different items with little adjustment needed. This helps businesses optimize production based on demand.
