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PPF - Increasing Marginal Opportunity Costs and Allocative Efficiency
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PPF - Increasing Marginal Opportunity Costs and Allocative Efficiency
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2. Introductory Economic Models / PPF - Increasing Marginal Opportunity Costs and Allocative Efficiency / Problem 9
Problem 9
Why does the PPF graph bow outward as more of one good is produced?
A
Resources are not equally efficient in producing both goods, leading to increasing opportunity costs.
B
The economy is experiencing allocative efficiency.
C
There is a constant opportunity cost between the two goods.
D
Resources are perfectly adaptable for the production of both goods.
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