Moving between two points on a PPF, a country gains 8 desktop computers and forgoes 4 laptop Computers. The opportunity cost of 1 desktop computer is
A)8 desktops.
B)1/2 of a laptop.
C)2 laptops.
D)1 desktop.
E)4 laptops.

Question

Quizplus · Accepted Answer

The opportunity cost of 1 desktop computer is 1/2 of a laptop. This is because the country can produce 8 desktop computers or 4 laptop computers with the same resources. Therefore, the opportunity cost of 1 desktop computer is 4/8 = 1/2 of a laptop.

Moving Between Two Points on a PPF, a Country Gains