Question

The law of increasing opportunity costs states that as a. less of a good is produced, the higher the opportunity costs of producing that good. b. more of a good is produced, the lower the opportunity costs of producing that good. c. more of a good is produced, the higher the opportunity costs of producing that good. d. more of a good is produced, the opportunity cost of producing the good remains the same. e. a and b

Answer 1

Answer:

 c. more of a good is produced, the higher the opportunity costs of producing that good

Explanation:

Opportunity cost is the next best option forgone when one alternative is chosen over other alternatives.

For example, a chef can cook either 10 plates of rice or 5 plates of yam in one hour.

Suppose he decides to cook 5 plates of yam. By deciding to cook yam, he forgoed the opportunity of cooking rice, this is known as opportunity cost. In one hour he cooks 5 plates of yam and forgoes the opportunity to cook 10 plates of rice. In the next hour, he cooks 10 plates of yams and forgoes the opportunity of cooking 20 plates of rice. By the third hour of cooking yam, he would have forgone the opportunity of cooking 30 plates of rice. This is known as increasing opportunity cost.

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