-Exhibit EE-2 depicts the production possibilities curves of wheat and corn for Nabia and Pada. In Nabia, the opportunity cost of producing a unit of wheat is

Question

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The opportunity cost of producing a unit of wheat in Nabia is 1/4 unit of corn. This is because the production possibilities curve for Nabia is a straight line, which means that the opportunity cost of producing one unit of wheat is constant. The slope of the production possibilities curve is -1/4, which means that for every unit of wheat that Nabia produces, it must give up 1/4 unit of corn.

-Exhibit EE-2 Depicts the Production Possibilities Curves of Wheat and Corn