If Farmer Sam MacDonald can produce 200 pounds of cabbages and 0 pounds of potatoes or 0 pounds of cabbages and 100 pounds of potatoes and faces a linear possibilities curve for his farm, the opportunity cost of producing an additional pound of cabbage is ____ __ pound(s)
Of potatoes.
A)1/2
B)2
C)100
D)200

Question

Quizplus · Accepted Answer

The opportunity cost of producing an additional pound of cabbage is the amount of potatoes that could have been produced instead. Given the linear possibilities curve and the provided production possibilities (200 pounds of cabbages = 0 pounds of potatoes, 0 pounds of cabbages = 100 pounds of potatoes), producing one more pound of cabbage means giving up 1/2 pound of potatoes, since 200 pounds of cabbage equates to 100 pounds of potatoes.

If Farmer Sam MacDonald Can Produce 200 Pounds of Cabbages