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Question
In which situation, can PPC be a straight line:
Options
When MRT is decreasing
When MRT is increasing
When MRT is constant
None of these
MCQ
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Solution
When MRT is constant
Explanation:
A straight-line PPC occurs when MRT is constant, meaning the same amount of one good is sacrificed for each additional unit of the other good. Decreasing MRT gives a convex PPC, and increasing MRT gives a concave PPC.
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