What Is the Reason for the Law of Increasing Opportunity

question 143

Multiple Choice

What is the reason for the law of increasing opportunity costs?

• A)There is no reason: it is just one of the laws of economics.
• B)Resources have varying abilities and those with lower opportunity costs of producing a good will be used to produce it before resources with higher opportunity costs produce it.
• C)The price of a good rises as more of it is demanded.
• D)As more of a good is produced, the taxes applied to the production of the good rise.

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Definitions:

Bond Investments

Financial securities that represent a loan made by an investor to a borrower, typically corporate or governmental.

Investment Amount

The total sum of money allocated to a particular investment or portfolio.

Bonds

A fixed income investment in which an investor loans money to an entity (corporate or sovereign) which borrows the funds for a definite period at a variable or fixed interest rate.

Excess Cash

Surplus funds that are not required for immediate operational needs or investment purposes.