Question

Assume that a PPF for butter and guns is drawn so that it is a straight line. It means ______.

विकल्प

• Less and less units of butter are sacrificed to gain an additional unit of gun

• More and more units of butter are sacrificed to gain an additional unit of gun

• Same units of butter are sacrificed to gain an additional unit of gun

• None of these

Answer 1

Assume that a PPF for butter and guns is drawn so that it is a straight line. It means same units of butter are sacrificed to gain an additional unit of gun.

Explanation:

A straight-line PPF indicates a constant MRT, so the same units of butter are sacrificed for every additional gun. Decreasing MRT gives a convex PPF, and increasing MRT gives a concave PPF.