This table shows how much wine and cheese can be produced in Spain and Portugal with one unit of equivalent resources.Initially there is no trade.Once trade opens up,transportation costs are assumed to be zero.
TABLE 32-5
-Refer to Table 32-5.The opportunity cost of cheese in terms of wine is

Question

This table shows how much wine and cheese can be produced in Spain and Portugal with one unit of equivalent resources.Initially there is no trade.Once trade opens up,transportation costs are assumed to be zero.
  TABLE 32-5
-Refer to Table 32-5.The opportunity cost of cheese in terms of wine is

Quizplus · Accepted Answer

Opportunity cost of cheese in Spain is (1/4) units of wine (4 units of wine can produce 1 unit of cheese in Spain). Therefore, it is more efficient for Spain to produce wine and trade for cheese with Portugal, where the opportunity cost of cheese is lower at 1 unit of wine.

This Table Shows How Much Wine and Cheese Can Be