Use the following to answer questions :
Figure: Production Possibility Frontier Curve for Tealand
-(Figure: Production Possibility Frontier for Tealand) Look at the figure Production Possibility Frontier for Tealand. Tealand is producing at point C on its production possibility frontier. What is the opportunity cost of increasing the production of tea from 20 million cups to 30 million cups?
A)10 million cups of tea
B)5 million scones
C)10 million scones
D)The answer is impossible to determine from the information given.

Question

Use the following to answer questions :
Figure: Production Possibility Frontier Curve for Tealand 
-(Figure: Production Possibility Frontier for Tealand) Look at the figure Production Possibility Frontier for Tealand. Tealand is producing at point C on its production possibility frontier. What is the opportunity cost of increasing the production of tea from 20 million cups to 30 million cups?
A)10 million cups of tea 
B)5 million scones 
C)10 million scones 
D)The answer is impossible to determine from the information given.

Quizplus · Accepted Answer

The opportunity cost of increasing tea production is the amount of scones that must be given up. If moving from 20 to 30 million cups of tea results in a decrease of 5 million scones, then that is the opportunity cost.

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