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The bowed shape of the production possibilities curve illustrates:
Question

The bowed shape of the production possibilities curve illustrates:

A.

Law of Increasing Marginal Cost

B.

The demand is relatively elastic

C.

The production is unattainable

D.

The production is inefficient

Correct option is A

The bowed shape of the production possibilities curve (PPC) represents the law of increasing marginal cost, which means producing more of one good requires sacrificing increasingly larger amounts of the other good.

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