With a budget of $200 million, the government can choose to purchase 4 helicopters or repair 200 km of highway. FIGURE 1- 1
-Refer to Figure 1- 1. For the government, the opportunity cost of one search and rescue helicopter is
A) 50 kilometres of highway repair.
B) 150 kilometres of highway repair.
C) 0 kilometres of highway repair.
D) 200 kilometres of highway repair.
E) 100 kilometres of highway repair.

Question

With a budget of $200 million, the government can choose to purchase 4 helicopters or repair 200 km of highway.  FIGURE 1- 1
-Refer to Figure 1- 1. For the government, the opportunity cost of one search and rescue helicopter is
A) 50 kilometres of highway repair. 
B) 150 kilometres of highway repair. 
C) 0 kilometres of highway repair. 
D) 200 kilometres of highway repair. 
E) 100 kilometres of highway repair.

Quizplus · Accepted Answer

The opportunity cost of one search and rescue helicopter is 50 kilometres of highway repair because the government can either use the resources to build 50 kilometres of highway or to purchase one search and rescue helicopter.

With a Budget of $200 Million, the Government Can Choose