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Question : PPF can be convex to the origin if

Option 1: MRT is decreasing

Option 2: MRT is increasing

Option 3: MRT is constant

Option 4: None of these


Team Careers360 14th Jan, 2024
Answer (1)
Team Careers360 21st Jan, 2024

Correct Answer: MRT is decreasing


Solution : In the case of diminishing MRT, PPF may be convex to the origin. In other words, less and fewer units of one commodity are surrendered in order to obtain an extra unit of another. Hence, the correct option is 1.

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