Country A currently produces ten CD players with one unit of resources and five televisions with another unit of resources. Country B currently produces eight CD players with one unit of resources and eight televisions with another unit of resources.
-The opportunity cost of producing CD players is:

Question

Quizplus · Accepted Answer

The opportunity cost of producing CD players in Country A is the amount of televisions that could have been produced with the resources used for CD players, and vice versa. In Country A, the opportunity cost of producing 10 CD players is 5 televisions (or 0.5 televisions per CD player), while in Country B, the opportunity cost of producing 8 CD players is 8 televisions (or 1 television per CD player). Therefore, the opportunity cost of producing CD players is lower in Country A than in Country B, because Country A gives up fewer televisions to produce a CD player than Country B does.

Country a Currently Produces Ten CD Players with One Unit