Suppose Nation A produces only two goods,apples and oranges.If Nation A produces only apples,it can make 20 apples per day.If Nation A produces only oranges,it can make 15 oranges per day.If the country has a constant production trade-off between apples and oranges,then the opportunity cost of one apple in Nation A is

Question

Quizplus · Accepted Answer

The opportunity cost of producing one apple is the amount of oranges that could have been produced instead. Since Nation A can produce 20 apples or 15 oranges per day, the opportunity cost of one apple is 15 oranges divided by 20 apples, which equals 0.75 oranges.

Suppose Nation a Produces Only Two Goods,apples and Oranges