If the United States, at the point where it is currently producing, must give up the production of 500 bicycles (B) to produce 20 additional tractors (T) with the same resources, the opportunity cost of producing 100 bicycles is _______ tractor(s).

Question

Quizplus · Accepted Answer

The opportunity cost of producing 100 bicycles can be calculated by finding out how many tractors the United States would have to give up in order to produce those 100 bicycles.

Given that 500 bicycles must be given up to produce 20 additional tractors, we can calculate the opportunity cost of producing 100 bicycles as follows:

500 bicycles = 20 tractors
1 bicycle = 20/500 tractors
100 bicycles = (20/500)*100 = 4 tractors

Therefore, the opportunity cost of producing 100 bicycles is 4 tractors.

The best choice is B.

If the United States, at the Point Where It Is