Asked by Caleb Kissel on Jun 24, 2024
Verified
Charlotte can produce pork and beans and can switch between producing them at a constant rate. If it takes her 10 hours to produce a pound of pork and 5 hours to produce a pound of beans, what is her opportunity cost of pork and what is her opportunity cost of beans?
Opportunity Cost
The cost of foregoing the next best alternative when making a decision, representing the benefits one misses out on when choosing one option over another.
Constant Rate
A fixed value of change in a quantity with respect to another quantity, often used in mathematics and economics to describe steady growth or decline.
- Assess the opportunity cost tied to the manufacture of various goods.
- Comprehend the consequences of engaging in trade with an unchanging opportunity cost.
Verified Answer
AS
Aamir SaeedJun 30, 2024
Final Answer :
The opportunity cost of pork is 10 pounds of beans/5 = 2 pounds of beans.
The opportunity cost of beans is 5 pounds of pork/10 pounds of pork = 1/2 pound of pork.
The opportunity cost of beans is 5 pounds of pork/10 pounds of pork = 1/2 pound of pork.
Learning Objectives
- Assess the opportunity cost tied to the manufacture of various goods.
- Comprehend the consequences of engaging in trade with an unchanging opportunity cost.