In one hour,Juan can produce 8 chairs or 2 tables.If chairs are on the vertical axis,the slope of his production possibilities curve is
A) 0.25.
B) - 0.25.
C) 4.
D) - 4.
E) - 2.

Question

Quizplus · Accepted Answer

The slope of the production possibilities curve is the opportunity cost of producing one more unit of the good on the horizontal axis (tables) in terms of the good on the vertical axis (chairs). Juan can produce 8 chairs or 2 tables in one hour, so the opportunity cost of 1 table is 4 chairs, making the slope -4.

In One Hour,Juan Can Produce 8 Chairs or 2 Tables