Katie and Hugh are producing pies and jars of pickles.Katie can produce either 200 jars of pickles or 100 pies per month.Hugh can produce either 800 jars of pickles or 200 pies per month.Which of the following statements is correct?
A)Katie's opportunity cost of producing 1 jar of pickles is 2 pies.
B)Katie's opportunity cost of producing 1 jar of pickles is 1/2 of a pie.
C)Hugh's opportunity cost of producing 1 jar of pickles is 4 pies.
D)Hugh's opportunity cost of producing 1 pie is 1/4 jar of pickles.
E)Hugh's and Katie's opportunity costs of producing are the same.

Question

Quizplus · Accepted Answer

Katie's opportunity cost of producing 1 jar of pickles is 1/2 of a pie because she can produce 100 pies instead of 200 jars of pickles, so for each jar of pickles, she gives up 0.5 pies.

Katie and Hugh Are Producing Pies and Jars of Pickles