Figure 1-7 shows the production possibilities boundary for an economy that produces two goods-cotton and bananas. FIGURE 1-7 Refer to Figure 1-7.A production possibilities boundary is shown for an economy that produces two goods-cotton and bananas,both measured in tonnes produced per year.Which of the following statements best describes the difference in opportunity costs that this economy faces at point A compared to point E?
A)The opportunity cost is 1500 tonnes of cotton at point A,compared to 500 tonnes at point E.
B)The opportunity cost is 500 tonnes of cotton at point A,compared to 1500 tonnes at point E.
C)The opportunity cost of producing an extra tonne of bananas is much higher at point A than at point E.
D)The opportunity cost of producing an extra tonne of bananas is much lower at point A than at point E.
E)The opportunity cost of producing an extra tonne of bananas is the same at point A as at point E.

Question

Figure 1-7 shows the production possibilities boundary for an economy that produces two goods-cotton and bananas.  FIGURE 1-7 Refer to Figure 1-7.A production possibilities boundary is shown for an economy that produces two goods-cotton and bananas,both measured in tonnes produced per year.Which of the following statements best describes the difference in opportunity costs that this economy faces at point A compared to point E?
A)The opportunity cost is 1500 tonnes of cotton at point A,compared to 500 tonnes at point E. 
B)The opportunity cost is 500 tonnes of cotton at point A,compared to 1500 tonnes at point E. 
C)The opportunity cost of producing an extra tonne of bananas is much higher at point A than at point E. 
D)The opportunity cost of producing an extra tonne of bananas is much lower at point A than at point E. 
E)The opportunity cost of producing an extra tonne of bananas is the same at point A as at point E.

Quizplus · Accepted Answer

The Answer of Figure 1-7 shows the production possibilities boundary for an economy that produces two goods-cotton and bananas.  FIGURE 1-7 Refer to Figure 1-7.A production possibilities boundary is shown for an economy that produces two goods-cotton and bananas,both measured in tonnes produced per year.Which of the following statements best describes the difference in opportunity costs that this economy faces at point A compared to point E?
A)The opportunity cost is 1500 tonnes of cotton at point A,compared to 500 tonnes at point E. 
B)The opportunity cost is 500 tonnes of cotton at point A,compared to 1500 tonnes at point E. 
C)The opportunity cost of producing an extra tonne of bananas is much higher at point A than at point E. 
D)The opportunity cost of producing an extra tonne of bananas is much lower at point A than at point E. 
E)The opportunity cost of producing an extra tonne of bananas is the same at point A as at point E.

Figure 1-7 Shows the Production Possibilities Boundary for an Economy