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Paper 1 · Opportunity Cost and Scarcity

The diagram below shows the transformation curve of an economy Why is the curve a straight line?

production possibility curve - ZIMSEC Economics past paper diagram
AResources are fully utilized
BThe marginal rate of transformation is decreasing
CThe marginal rate of transformation is constant
DThe economy is experiencing diminishing returns

ZIMSEC Economics Paper 1, November 2002, Q1

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