To find the opportunity cost of producing one more unit of any product while on the production possibilities frontier requires
A)setting the change in one product equal to the change in the other product.
B)dividing the amount of the product forgone by the amount of the product gained.
C)setting the amounts of the two products equal to each other.
D)subtracting the change in the product whose production increased from the change in the product whose production decreased.
E)None of these describe how to find opportunity cost.

Question

Quizplus · Accepted Answer

The opportunity cost of producing one more unit of any product while on the production possibilities frontier is the amount of the other product that must be forgone. This can be found by dividing the amount of the product forgone by the amount of the product gained, which is option B.

To Find the Opportunity Cost of Producing One More Unit