Question

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?

Answer 1

The slope of production possibility curve is marginal opportunity cost which refers to the additional sacrifice that a firm makes when they shift 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.