Table 7-2
Madison and Austin own Cafe Ole'.Table 7-2 lists the number of empanadas and tacos Madison and Austin can each make in one hour.
-Refer to Table 7-2.Select the statement that accurately interprets the data in the table.
A)Madison has a greater opportunity cost than Austin for making tacos.
B)Madison's opportunity cost for making tacos is less than Austin's.
C)Austin has a greater opportunity cost than Madison for making empanadas.
D)Austin's opportunity cost for making tacos and making empanadas are both greater than Madison's.

Question

Table 7-2
  Madison and Austin own Cafe Ole'.Table 7-2 lists the number of empanadas and tacos Madison and Austin can each make in one hour.
-Refer to Table 7-2.Select the statement that accurately interprets the data in the table.
A)Madison has a greater opportunity cost than Austin for making tacos. 
B)Madison's opportunity cost for making tacos is less than Austin's. 
C)Austin has a greater opportunity cost than Madison for making empanadas. 
D)Austin's opportunity cost for making tacos and making empanadas are both greater than Madison's.

Quizplus · Accepted Answer

Opportunity cost can be defined as the cost of forgoing the next best alternative. In this case, we can compare the number of empanadas and tacos each person can make in an hour to determine their opportunity cost for each item. According to the table, Madison can make 2 tacos or 8 empanadas in an hour, while Austin can make 3 tacos or 6 empanadas. This means that Madison's opportunity cost for making one taco is 4 empanadas, while Austin's opportunity cost for making one taco is 2 empanadas. Therefore, Madison's opportunity cost for making tacos is less than Austin's.

Table 7-2 Madison and Austin Own Cafe Ole'.Table 7-2 Lists