Table 1.1 - Production possibilities and opportunity costs of missiles and houses
Table 1.1 shows the tradeoff between different combinations of missile production and home construction,ceteris paribus.Complete the table by calculating the required opportunity costs for both missiles and houses.Then answer the indicated question(s).
-In Table 1.1,what is the opportunity cost of increasing the production of missiles from 2 to 3 in terms of houses?

Question

Table 1.1 - Production possibilities and opportunity costs of missiles and houses
Table 1.1 shows the tradeoff between different combinations of missile production and home construction,ceteris paribus.Complete the table by calculating the required opportunity costs for both missiles and houses.Then answer the indicated question(s). 
-In Table 1.1,what is the opportunity cost of increasing the production of missiles from 2 to 3 in terms of houses?

Quizplus · Accepted Answer

The opportunity cost is the number of houses that must be sacrificed to produce one more missile. If increasing missile production from 2 to 3 results in a decrease of 7,000 houses, then the opportunity cost is 7,000 houses.

Table 11 - Production Possibilities and Opportunity Costs of Missiles and and Houses