Figure 1.2
-If the economy starts at point B in Figure 1.2, what is the opportunity cost of producing an additional 75 units of military goods?

Question

Quizplus · Accepted Answer

The opportunity cost of producing an additional 75 units of military goods is 65 units of civilian goods. This is because the economy is initially at point B, which is on the production possibilities frontier. Moving from point B to produce an additional 75 units of military goods requires giving up 65 units of civilian goods.

Figure 1.2 -If the Economy Starts at Point B in Figure 1.2