-Refer to Table 2-1. What is the opportunity cost to Toyland of increasing the production of dolls from 550 to 600?
A) 50 toy cars
B) 100 toy cars
C) 150 toy cars
D) 200 toy cars

Question

-Refer to Table 2-1. What is the opportunity cost to Toyland of increasing the production of dolls from 550 to 600?
A) 50 toy cars 
B) 100 toy cars 
C) 150 toy cars 
D) 200 toy cars

Quizplus · Accepted Answer

The opportunity cost of producing more of one good is the amount of the other good that must be given up. Without the specific details from Table 2-1, the general principle is that to increase the production of one item (in this case, dolls), Toyland must reduce its production of another item (toy cars). The correct answer is determined by the specific trade-off rates provided in the table, which typically show how many units of one good must be forgone to produce additional units of another good. Given the options, if the correct answer is B) 100 toy cars, it means that to produce 50 more dolls, Toyland must reduce its production of toy cars by 100 units, indicating the opportunity cost of the increased doll production.