Moving between two points on a PPF, a country gains 6 cars and forgoes 3 trucks. The opportunity cost of 1 car is
A) 1/2 of a truck.
B) 2 trucks.
C) 3 trucks.
D) 6 cars - 3 trucks.
E) 1 car.

Question

Quizplus · Accepted Answer

The opportunity cost of 1 car is the amount of trucks given up for 1 car. Since the country gains 6 cars and forgoes 3 trucks, the opportunity cost of 1 car is 3/6 or 1/2 of a truck. Therefore, the correct answer is A).

Moving Between Two Points on a PPF, a Country Gains