Table 3-2
-If the producer is at combination B as shown in Table 3-2, the opportunity cost of increasing corn production by 1 unit is
A)29 units of cotton.
B)5 units of cotton.
C)12 units of cotton.
D)4 units of cotton.
E)1 unit of cotton.

Question

Table 3-2  ​
-If the producer is at combination B as shown in Table 3-2, the opportunity cost of increasing corn production by 1 unit is
A)29 units of cotton. 
B)5 units of cotton. 
C)12 units of cotton. 
D)4 units of cotton. 
E)1 unit of cotton.

Quizplus · Accepted Answer

The opportunity cost of producing an additional unit of one good is the amount of the other good that must be forgone. To determine this, look at the difference in production levels between the current and next possible combination. If moving from combination B to the next increases corn production by 1 unit, the decrease in cotton production represents the opportunity cost.

Table 3-2 ​

Table 3-2