Figure 2.4 Production Possibilities Frontier

-In Figure 2.4 one ton of wheat can be produced at a cost of
A) one and two-thirds cars
B) two and one-third cars
C) three fifths of a car
D) three sevenths of a car

Question

Figure 2.4 Production Possibilities Frontier
 
-In Figure 2.4 one ton of wheat can be produced at a cost of
A) one and two-thirds cars 
B) two and one-third cars 
C) three fifths of a car 
D) three sevenths of a car

Quizplus · Accepted Answer

Looking at the graph, the opportunity cost of producing one ton of wheat is the slope of the production possibilities frontier. At point A, one ton of wheat can be produced at the cost of producing 0.6 cars (or three fifths of a car). Therefore, the best choice is C.