Graph 2-1

-Refer to Graph 2-1. In the graph shown, the opportunity cost to the economy of moving from point A to point B is 10 units of concrete.

Question

Graph 2-1
 
-Refer to Graph 2-1. In the graph shown, the opportunity cost to the economy of moving from point A to point B is 10 units of concrete.

Quizplus · Accepted Answer

The slope of the production possibility curve (PPC) represents the opportunity cost, which is the rate at which one good must be sacrificed in order to produce a unit of the other good. Moving from point A to point B involves producing more cars and fewer units of concrete, and the slope of the PPC between these two points is equal to -10 (i.e. 10 units of concrete must be given up to produce 1 more car). Therefore, the opportunity cost of moving from point A to point B is indeed 10 units of concrete.

Graph 2-1 -Refer to Graph 2-1. in the Graph Shown, the Opportunity