Use the following to answer questions:
-(Table: Production Possibilities for Machinery and Petroleum)Use Table: Production Possibilities for Machinery and Petroleum.The opportunity cost of _____ is _____ in Canada as (than)in Mexico.

Question

Use the following to answer questions: 
-(Table: Production Possibilities for Machinery and Petroleum)Use Table: Production Possibilities for Machinery and Petroleum.The opportunity cost of _____ is _____ in Canada as (than)in Mexico.

Quizplus · Accepted Answer

According to the table, Canada can produce 8 machinery or 12 petroleum while Mexico can produce 2 machinery or 6 petroleum. To produce one unit of machinery, Canada must give up 1.5 units of petroleum, while Mexico must give up 3 units of petroleum. Therefore, the opportunity cost of producing machinery is lower in Canada than in Mexico, meaning Canada is more efficient in producing machinery. Hence, the answer is C, as the opportunity cost of machinery is less in Canada than in Mexico.

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