The Reason the Production Possibilities Curve Is Bowed Outward (Concave)

question 208

Multiple Choice

The reason the production possibilities curve is bowed outward (concave) is

• A) the law of increasing additional cost.
• B) that technology is constantly changing.
• C) that the number of resources is increasing.
• D) that the economy has more capital goods than entrepreneurial effort.

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Definitions:

Customizing Orders

The process of making changes to standard product offerings to meet the specific needs or preferences of a customer.

Profit Margin

A financial metric that measures the percentage of profit a company produces from its total revenue.

Additional Labor

Employees or work hours added beyond the initial planning or standard staffing levels, often to meet increased production demands or to cover for unexpected labor shortages.

Variable Cost Concept

A cost that varies with the level of output or activity, in contrast to fixed costs, which remain constant regardless of activity.