Final answer:
An economy that uses new technology moves along its PPF and incurs an opportunity cost due to the law of increasing opportunity cost, which implies that more production of one good comes with the trade-off of less production of another.
Step-by-step explanation:
An economy that uses new technology will see its production possibilities frontier (PPF) shift outwards. This is because technological improvements increase the level of production that can be achieved with given resources, hence pushing out the PPF. An important concept in this scenario is the law of increasing opportunity cost, which states that as production of a good increases, the opportunity cost of producing an additional unit also increases. In this context, the correct answer to the question "An economy that uses new technology?" is C. moves along its PPF and incurs an opportunity cost. This underlines the fact that even with technological advancements, producing more of one good still requires the economy to incur an opportunity cost, reflecting the resources that could have been used to produce something else.