Constant Opportunity Cost from Straight-Line PPC

Steps:

• Examine the PPC shape: a straight line between food and drink axes shows constant trade-offs.
• Calculate opportunity cost: slope remains uniform, meaning fixed units of one good sacrificed for the other.
• Compare to curved PPCs: no increasing or decreasing costs evident.
• Conclude based on linearity: equal opportunity cost at all production points.

Why D is correct:

• In a straight-line PPC, the opportunity cost is constant, as the slope (ratio of goods forgone) does not change, per standard economic definition.

Why the others are wrong:

• A: Normal goods relate to consumer demand, not production frontiers.
• B: Falling cost implies a convex curve, not shown.
• C: Self-sufficiency requires points inside/outside PPC, but diagram only shows possibilities, not actual output.

Final answer: D