Use the following scenario to answer the questions that follow.
Karl and Pete produce cars and trucks. Karl can produce 10 cars per hour or 5 trucks per hour. Pete can produce 12 cars per hour or 4 trucks per hour.
-Based on the scenario,Pete's opportunity cost of one car is ________ truck(s).

Question

Quizplus · Accepted Answer

Pete has to give up 4 trucks to produce 12 cars, so his opportunity cost of one car is 4/12 or 1/3 trucks.

Answer: Produce trucks only
 Karl can produce 10 cars per hour or 5 trucks per hour, but his opportunity cost of producing one truck is only 2 cars. Meanwhile, Pete can produce 12 cars per hour or 4 trucks per hour, but his opportunity cost of producing one truck is 1/3 cars. Therefore, it is more efficient for Karl to produce trucks while Pete produces cars.

Use the Following Scenario to Answer the Questions That Follow