Figure 2.4 Production Possibilities Frontier

-In Figure 2.4 the marginal rate of transformation of wheat into autos is
A) one and two-thirds
B) two and one-third
C) three fifths
D) three sevenths

Question

Figure 2.4 Production Possibilities Frontier
 
-In Figure 2.4 the marginal rate of transformation of wheat into autos is
A) one and two-thirds 
B) two and one-third 
C) three fifths 
D) three sevenths

Quizplus · Accepted Answer

The marginal rate of transformation (MRT) is the slope of the production possibility frontier (PPF). If the MRT is given as one and two-thirds, it means that for every unit of autos produced, one and two-thirds units of wheat must be given up, indicating the opportunity cost of producing autos in terms of wheat.