The production possibilities frontier (PPF) becomes flatter as the amount of capital per worker increases because of:

• A. diminishing marginal returns to capital
• B. constant returns to scale
• C. increasing opportunity costs
• D. technological regress

Answer: (A)

Verified step by step guidance

1. Understand the concept of the Production Possibilities Frontier (PPF): it shows the maximum possible output combinations of two goods or inputs given available resources and technology.
2. Recall that the slope of the PPF represents the opportunity cost of producing one good in terms of the other good.
3. Recognize that as capital per worker increases, the additional output gained from each extra unit of capital tends to decrease, which is known as diminishing marginal returns to capital.
4. Connect diminishing marginal returns to capital with the shape of the PPF: as more capital is used, the opportunity cost of producing additional output changes, causing the PPF to become flatter.
5. Eliminate other options by understanding that constant returns to scale imply a straight-line PPF, increasing opportunity costs cause a bowed-out PPF, and technological regress would shift the PPF inward rather than change its slope.