Question

Specialization and the gains from trade make the economy PPF outward bowed because​ _______. A. a good is initially produced by producers with higher opportunity costs and eventually produced by producers with lower opportunity costs B. all producers have​ bowed-out PPF​s, and the economy PPF is the horizontal sum of the individual PPFs C. as more of a good is​ produced, people are willing to pay less for each additional unit of the good D. a good is initially produced by producers with lower opportunity costs and eventually produced by producers with higher opportunity costs

Answer 1

A. a good is initially produced by producers with higher opportunity costs and eventually produced by producers with lower opportunity costs

Step-by-step explanation:

The production possibility frontier is a curve that shows the two combinations of goods and services produced in an economy.

Because of trade a country can specialise in the production of goods for which it has a lower opportunity cost in its production and import goods for which it has a higher opportunity cost.

This makes the ppf bowed out as the country produces more of the good for which it has a lower opportunity cost and less of the good for which it has a higher opportunity cost.

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