Option 1 -> As resources shift from Use 1 to Use 2, less suitable resources are progressively employed, increasing opportunity cost.
Option 2 -> Incorrect, as the law of increasing opportunity cost causes MRT to rise, not fall.
Option 3 -> Would only hold if resources were perfectly substitutable between uses, which is unrealistic.
Option 4 -> MRT cannot be zero when resources are being reallocated between alternative uses.
Hence, Option 1: increases -> The Marginal Rate of Transformation (MRT) measures the opportunity cost of producing one more unit of a good by sacrificing another. When resources are shifted from Use 1 to Use 2, the most suitable resources for Use 2 are transferred first. As more resources continue to shift, increasingly less suitable resources must be used, requiring greater sacrifice of Use 1 to produce additional units of Use 2. This reflects the law of increasing opportunity cost, causing the MRT to increase progressively. -> correct