The Production Possibilities Curve for Two Products Is Bowed Out

question 8

Multiple Choice

The production possibilities curve for two products is bowed out because

• A) as the production of a good increases, opportunity cost increases.
• B) as the production of a good increases, opportunity cost is unchanged.
• C) the qualities of the resources are not identical.
• D) there are unemployed resources.

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Definitions:

Downward Pressure

Forces or factors that lead to a decrease in prices, wages, or other economic indicators.

European Union

A political and economic union of 27 European countries that are located primarily in Europe, aiming to promote peace, stability, and economic cooperation among its members.

Capital Mobility

The ease with which capital or investments can move across borders in response to differences in return or risk, impacting global trade and investment decisions.

Common Labor Laws

Laws that regulate the legal obligations between employers and workers, including wages, working hours, safety, and rights to organize.