BAE, a British defense company, has the contract to produce Tornado aircraft for the Royal Air Force. BAE is producing the aircraft at the lowest possible cost. If the RAF orders one more Tornado, there will be

A) a decrease in opportunity costs as average costs decrease.
B) a misallocation of resources.
C) an increase in opportunity cost for Tornados.
D) an outward shift in the PPF.

C

Economics

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