One of the major reasons why the United States exports jet airplanes is because Boeing faces ________ opportunity cost compared with firms in other nations in the production of such aircraft.

Question

Quizplus · Accepted Answer

The concept of opportunity cost refers to the cost of forgoing the next best alternative. In this case, it means that in choosing to produce jet airplanes, Boeing has to give up producing other goods and services it could have produced instead. The lower the opportunity cost of producing jet airplanes for Boeing, the more advantageous it is for them to produce and export them. Therefore, if Boeing faces a lower opportunity cost compared to firms in other nations, it means that it is better suited to producing and exporting jet airplanes.

One of the Major Reasons Why the United States Exports