Which of the following options cause change in the "Transformation curve"?

Marginal opportunity cost

The correct option that causes a change in the "Transformation Curve" is: Marginal opportunity cost

The transformation curve, also known as the production possibility frontier (PPF), represents the maximum output combinations of two goods that can be produced given available resources and technology. The marginal opportunity cost often known as marginal rate of transformation decides the shape of the Transformation curve/PPC i.e. Production Possibility Curve. Increasing marginal rate of transformation makes the PPC concave to origin. Any change in the rate will influence the shape of the curve.

• Rightward shift of the Transformation Curve if the marginal opportunity cost decreases (i.e., it becomes less expensive to produce one good relative to the other). This signifies an expansion in production possibilities.
• Leftward shift of the Transformation Curve if the marginal opportunity cost increases (i.e., it becomes more expensive to produce one good relative to the other). This signifies a contraction in production possibilities.