SCENARIO: CHILE AND ARGENTINA
Chile and Argentina each produce jellybeans and peanut butter, using
Labor as their only resource.Each country has 1,000 hours of labor.In
Chile, an hour produces a pound of jellybeans and 2 hours produce a
Pound of peanut butter.In Argentina, an hour produces a pound of
Jellybeans and 3 hours produces a pound of peanut butter.When they do
Not trade with each other, Chile consumes 600 pounds of jellybeans and
200 pounds of peanut butter, and Argentina consumes 400 pounds of
Jellybeans and 200 pounds of peanut butter.
Reference: Ref 210
(Scenario: Chile and Argentina) What is the opportunity cost of a pound
Of peanut butter in Chile?
A)2 pounds of jellybeans per pound of peanut butter
B)3 pounds of jellybeans per pound of peanut butter
C)1/3 pound of jellybeans per pound of peanut butter
D)1/2 pound of jellybeans per pound of peanut butter

Question

SCENARIO: CHILE AND ARGENTINA
Chile and Argentina each produce jellybeans and peanut butter, using
Labor as their only resource.Each country has 1,000 hours of labor.In
Chile, an hour produces a pound of jellybeans and 2 hours produce a
Pound of peanut butter.In Argentina, an hour produces a pound of
Jellybeans and 3 hours produces a pound of peanut butter.When they do
Not trade with each other, Chile consumes 600 pounds of jellybeans and
200 pounds of peanut butter, and Argentina consumes 400 pounds of
Jellybeans and 200 pounds of peanut butter.
Reference: Ref 2­10
(Scenario: Chile and Argentina) What is the opportunity cost of a pound
Of peanut butter in Chile?
A)2 pounds of jellybeans per pound of peanut butter
B)3 pounds of jellybeans per pound of peanut butter
C)1/3 pound of jellybeans per pound of peanut butter
D)1/2 pound of jellybeans per pound of peanut butter

Quizplus · Accepted Answer

In Chile, it takes 2 hours to produce a pound of peanut butter, which means those 2 hours could have been used to produce 2 pounds of jellybeans. Therefore, the opportunity cost of producing 1 pound of peanut butter is 2 pounds of jellybeans.