Canada must give up the production of 500 bicycles to produce 20 additional tractors.The opportunity cost of producing 5 tractors is _____ bicycles.

Question

Quizplus · Accepted Answer

To produce 20 tractors, Canada must give up 500 bicycles. Therefore, the opportunity cost of producing 1 tractor is:

500 bicycles / 20 tractors = 25 bicycles per tractor

To produce 5 tractors, the opportunity cost is:

25 bicycles per tractor × 5 tractors = 125 bicycles.

Therefore, the answer is D.

Canada Must Give Up the Production of 500 Bicycles to Produce