why ppc curve is also called opportunity cost curve

Production Possibility Curve is called the opportunity cost curve as it is the curve which shows the combinations of two goods and services that can be produced with fuller utilisation of a given amount of resources in the most efficient way and with a given production technology. It is also known as Transformation curve. PPC is concave to origin. This is because of the increasing opportunity cost i.e. in accordance with the law of increasing opportunity cost. 

  • -4
What are you looking for?