-Refer to Exhibit 34-6.The opportunity cost of 1 unit of wine in terms of units of cheese is __________ for country A.

Question

Quizplus · Accepted Answer

The opportunity cost of producing 1 unit of wine in country A is the amount of cheese that could have been produced with the resources used to produce that unit of wine. From the given exhibit (which is not visible but assuming standard comparative advantage scenarios), if country A can produce wine at the cost of foregoing 2 units of cheese, then the opportunity cost of 1 unit of wine in terms of cheese is 2 units.