-Sam's opportunity cost of producing an extra pair of shoes is
A) 3/4 pairs of pants.
B) 4/5 pairs of pants.
C) 1 pair of pants.
D) 5/4 pairs of pants.
E) 4/3 pairs of pants.

Question

-Sam's opportunity cost of producing an extra pair of shoes is
A) 3/4 pairs of pants. 
B) 4/5 pairs of pants. 
C) 1 pair of pants. 
D) 5/4 pairs of pants. 
E) 4/3 pairs of pants.

Quizplus · Accepted Answer

Opportunity cost is the value of the next best alternative foregone. If Sam's opportunity cost of producing an extra pair of shoes is 3/4 pairs of pants, it means he gives up 3/4 pairs of pants to produce one additional pair of shoes.

-Sam's Opportunity Cost of Producing an Extra Pair of Shoes