An economy has two workers, Paula and Ricardo. Every day they work, Paula can produce 4 computers or 16 shirts, and Ricardo can produce 6 computers or 12 shirts. What is the opportunity cost for Paula to produce one computer?

Question

Quizplus · Accepted Answer

In the time it takes Paula to produce 4 computers, she could have made 16 shirts, so she gives up 4 shirts for every computer she makes.

An Economy Has Two Workers, Paula and Ricardo