Asked by Marianne Szabelski on Jul 01, 2024
Verified
Refer to Figure 3-6. What is Greg's opportunity cost of producing ice cream? Explain how you derived your answer.
Opportunity Cost
Missing potential benefits that could have been gained from unchosen options when deciding on one.
Production Possibilities
A graphical representation that shows the maximum combination of goods or services that can be produced with a fixed amount of resources.
- Estimate the lost potential in the production of different products.
Verified Answer
ZK
Zybrea KnightJul 04, 2024
Final Answer :
It takes Greg 1 hour to produce a quart of ice cream and 2 hours to produce a cake. So, the opportunity cost of producing a quart of ice cream is 1/2 cake.
Learning Objectives
- Estimate the lost potential in the production of different products.