Marius and Jennifer are going to sell cupcakes and muffins at their third annual fundraiser bake sale. In one day, Marius can make 40 cupcakes or 20 muffins, and Jennifer can make 15 cupcakes or 15 muffins. What is Marius's opportunity cost of producing one cupcake?

Question

Quizplus · Accepted Answer

Marius's opportunity cost of producing one cupcake is 0.5 muffin because he can make 40 cupcakes or 20 muffins in a day. Therefore, for each cupcake he makes, he forgoes making 0.5 muffin (20 muffins/40 cupcakes = 0.5 muffin per cupcake).

Marius and Jennifer Are Going to Sell Cupcakes and Muffins