Carlos can produce the following combinations of X and Y: 10X and 10Y, 5X and 15Y, and 0X and 20Y. The opportunity cost of one unit of X for Carlos is
A)1 unit of Y.
B)2 units of Y.
C)1\2 unit of Y.
D)1\4 unit of Y.

Question

Quizplus · Accepted Answer

The opportunity cost of one unit of X is 1 unit of Y because Carlos can produce either 10X and 10Y or 5X and 15Y. This means that for every unit of X that Carlos produces, he must give up 1 unit of Y.

Carlos Can Produce the Following Combinations of X and Y