Question 14
Basic ConceptsThe transformation curve slope indicates the
- A.opportunity cost of producing one commodity for another
- B.opportunity cost of producing two commodities at a time
- C.sale of the plant to other investors
- D.decrease in the cost of production.
Show the answer and explanation
Answer: A (opportunity cost of producing one commodity for another)
Explanation
The slope of the production possibility (transformation) curve shows how much of one good is given up to produce more of the other.