Exhibit 2-12 Maria and Hans Production Possibilities for Laundry and Typing
-According to Exhibit 2-12,Hans' opportunity cost of doing a load of laundry is

Question

Exhibit 2-12 Maria and Hans Production Possibilities for Laundry and Typing 
-According to Exhibit 2-12,Hans' opportunity cost of doing a load of laundry is

Quizplus · Accepted Answer

To calculate opportunity cost, we need to consider the trade-off of producing one unit of laundry in terms of the production of typing. For Hans, the slope of the production possibilities frontier (PPF) for laundry is -8/2 = -4 (which means he gives up 4 pages of typing to do one load of laundry). Therefore, the opportunity cost of doing one load of laundry for Hans is 1/4 of a page (or 0.25 pages, or 1/2 of a piece of paper).