Table 2-5
Table 2-5 shows the number of labor hours required to produce a cell phone and a board foot of lumber in Estonia and Finland.
-Refer to Table 2-5.What is Estonia's opportunity cost of producing one cell phone?
A)0.2 board feet of lumber
B)5 board feet of lumber
C)8 board feet of lumber
D)32 board feet of lumber

Question

Table 2-5
  Table 2-5 shows the number of labor hours required to produce a cell phone and a board foot of lumber in Estonia and Finland.
-Refer to Table 2-5.What is Estonia's opportunity cost of producing one cell phone?
A)0.2 board feet of lumber 
B)5 board feet of lumber 
C)8 board feet of lumber 
D)32 board feet of lumber

Quizplus · Accepted Answer

The opportunity cost of producing one unit of a good is determined by the alternative forgone to produce that unit. In this case, if Estonia produces one cell phone, it gives up the production of 5 board feet of lumber, hence the opportunity cost is 5 board feet of lumber.

Table 2-5 Table 2-5 Shows the Number of Labor Hours