Hutch Technology makes computer monitors, which sell for $100 each.What is the opportunity cost of ten monitors?
A)$1,000.
B)the other goods that could be produced with the resources that produce the ten monitors
C)the profits that Hutch earns when it sells the ten monitors
D)the profits that Hutch loses if it does not produce the monitors
E)All of the above are correct.

Question

Hutch Technology makes computer monitors, which sell for $100 each.What is the opportunity cost of ten monitors?
A)$1,000.
B)the other goods that could be produced with the resources that produce the ten monitors 
C)the profits that Hutch earns when it sells the ten monitors 
D)the profits that Hutch loses if it does not produce the monitors 
E)All of the above are correct.

Quizplus · Accepted Answer

The opportunity cost of producing ten monitors is the value of the next best alternative foregone, which in this case is the production of other goods that could be made with the same resources used to create the monitors. Therefore, the correct answer is B. The other choices are not opportunity costs of the monitors themselves.

Hutch Technology Makes Computer Monitors, Which Sell for $100 Each