QAEconomics › What is the reason for the law of increasing opportunity costs?
Q

What is the reason for the law of increasing opportunity costs?

A

The law of opportunity costs is driven by the fact that an increase in the production of a product increases its opportunity cost. To get a larger amount of a product, a business will require more resources for production. Opportunity cost is the amount you sacrifice to get what you want to be done. This means that when you increase the production of product A, the resources available for B, will decrease due to its budget being used as opportunity cost.

3 years ago
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