The table above shows the production possibilities for an economy. The opportunity cost of a loaf of bread is ________ when moving from possibility B to possibility C.

Question

Quizplus · Accepted Answer

The opportunity cost of a loaf of bread is 1/2 of a book when moving from possibility B to possibility C. This is because the economy can produce either 100 loaves of bread or 200 books. When the economy moves from possibility B to possibility C, it produces 50 more loaves of bread and 100 fewer books. Therefore, the opportunity cost of a loaf of bread is 100 books / 50 loaves of bread = 1/2 of a book.

The Table Above Shows the Production Possibilities for an Economy