Using all available resources, if a farmer can produce either 65 cantaloupes or 70 watermelons, what is the opportunity cost of 1 cantaloupe to the farmer?
A) 0.82 watermelons
B) 1.08 watermelons
C) 1.50 watermelons
D) 2.00 watermelons

Question

Quizplus · Accepted Answer

The opportunity cost of 1 cantaloupe is the number of watermelons the farmer must forego producing in order to produce 1 additional cantaloupe. Therefore, the opportunity cost of 1 cantaloupe is 70/65 = 1.08 watermelons. 
The best choice is to produce the crop with the higher opportunity cost, which is watermelons since the farmer must forego more cantaloupes to produce 1 additional watermelon.

Using All Available Resources, If a Farmer Can Produce Either