Tradeoffs lead to antagonistic relationships between phenotypic traits and are thought to be determined both genetically and environmentally. We present here an allocation model that distinguishes between the genetic and environmental components of variation in resource allocation. In this model we introduced plasticity of resource allocation which was considered to be an adaptive response to environmental variations. The results show that resource allocation plasticity is a key parameter for the existence of environmental (i.e. inter environments and intra genotype) correlations and is therefore necessary to detect environment-induced tradeoffs. We also investigated the impact of the resource allocation plasticity and other factors on genetic (i.e. inter genotypes) correlations. Our results show that resource allocation plasticity induces a masking effect of tradeoffs when studying genetic correlations and increases the masking effect of resource variation by making apparent correlations positive when negative correlations are expected. In addition, by simulating different sources of resource acquisition variation, we demonstrated that resource variation might have different effects on correlations according to the experimental design and the studied biological material. Further development of this model may be used to investigate the theoretical implications of tradeoffs in evolutionary biology and to improve design and interpretation of experimental studies.