In Spain it takes 10 workers to produce one barrel of wine and four workers to produce one yard of cloth. Thus, the opportunity cost of producing one barrel of wine is 2.5 yards of cloth.

Question

Quizplus · Accepted Answer

This is because the opportunity cost of producing one unit of wine is calculated by dividing the number of units of cloth that could be produced with the same resources (10 workers) by the number of units of wine that could be produced with the same resources. So, 10 workers can produce 2.5 yards of cloth (10/4), which means that the opportunity cost of producing one barrel of wine is 2.5 yards of cloth.

In Spain It Takes 10 Workers to Produce One Barrel