Production possibilities tables for two countries,North Cantina and South Cantina:
North Cantina
Production possibilities (alternatives)
South Cantina
Production possibilities (alternatives)

-Refer to the above tables.The opportunity cost of the fifth unit of capital goods:
A) is higher in North Cantina than in South Cantina.
B) is the same in North Cantina and South Cantina.
C) is lower in North Cantina than in South Cantina.
D) cannot be determined from the information provided.

Question

Production possibilities tables for two countries,North Cantina and South Cantina:
North Cantina
Production possibilities (alternatives)
  South Cantina
Production possibilities (alternatives)
 
-Refer to the above tables.The opportunity cost of the fifth unit of capital goods:
A) is higher in North Cantina than in South Cantina. 
B) is the same in North Cantina and South Cantina. 
C) is lower in North Cantina than in South Cantina. 
D) cannot be determined from the information provided.

Quizplus · Accepted Answer

The opportunity cost of the fifth unit of capital goods is 10 units of consumer goods in North Cantina and 12 units of consumer goods in South Cantina. Therefore, the opportunity cost is higher in South Cantina.

Production Possibilities Tables for Two Countries,North Cantina and South Cantina