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

Question

Quizplus · Accepted Answer

The opportunity cost of producing a unit of wheat in Pada is 1/3 unit of corn. This is because the production possibilities curve for Pada 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 -1/3, which means that for every unit of wheat that Pada produces, it must give up 1/3 unit of corn.

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