consider two straight-line ppfs. they have the same vertical intercept, but curve i is flatter than curve ii. the opportunity cost of producing the good on the vertical axis

Sagot :

Two straight-line PPFs tend to have the same vertical intercept, but curve I is flatter than curve II. The opportunity cost of producing the good on the vertical axis is greater along curve I.

The Production Possibility Frontier (PPF) is a curve on a graph which illustrates the possible quantities which can be produced of two products if both products are dependent upon the same finite resource for their manufacture.

The slope of the PPF tends to indicate the opportunity cost of producing one good versus the other good. So two straight-line PPFs tend to have the same vertical intercept, but curve I is flatter than curve II.

Hence, the opportunity cost of producing the good on vertical axis is greater along curve I.

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