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Standard XII

Biology

Logistic Growth Graph

Marginal oppo...

Question

Marginal opportunity cost falls as resources are shifted from Good - $1$ to Good - $2$ .

True

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False

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Solution

The correct option is B False
The slope of production possibility curve is the marginal opportunity cost, which refers to the additional sacrifice that an economy needs to make when it shifts resources and technology from production of one commodity to the other. Since resources are use specific, therefore every time when one more unit of a commodity is produced more units of the other commodity is sacrificed that results in increasing marginal opportunity cost.

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Similar questions

Q. Why marginal opportunity cost must rise as resources are shifted from Use-

1

to Use-

2

, even when given resources are fully and efficiently utilised?

Q. Multiple Choice Question:

Output of Good-X decreases by

500

units and output of Good - Y increases by

500

units, when some resources are shifted from the production of X to the production of Y. The marginal opportunity cost is __________.

Output of Good-X decreases by 400 units and output of Good-Y increases by 400 units, and some resources are shifted from the production of X to the production of Y, the marginal opportunity cost is

When output of Good -

1

increases from

100

units to

110

units and output of Good -

2

decreases from

400

units to

350

units, marginal opportunity cost =

50

units.

Q. Find marginal opportunity cost when shifting some resources from

U s e - 1

U s e - 2

causes a loss of output of

1, 500

units in

U s e - 1

and gain of output

R s . 1, 000

units in

U s e - 2

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Marginal opportunity cost falls as resources are shifted from Good - 1 to Good - 2.

Marginal opportunity cost falls as resources are shifted from Good - $1$ to Good - $2$ .