Use the following to answer questions:
-(Table: Production Possibilities for Machinery and Petroleum)Use Table: Production Possibilities for Machinery and Petroleum.The opportunity cost in Canada of producing 30 units of petroleum is _____ units of machinery.

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 in Canada of producing 30 units of petroleum is _____ units of machinery.

Quizplus · Accepted Answer

To produce 30 units of petroleum, Canada would have to give up producing either 60 units of machinery or 40 units of steel. Since the opportunity cost of producing 30 units of petroleum in machinery is lower (60 units) than producing it in steel (80 units), the best choice would be to produce 30 units of petroleum and 60 units of machinery.

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