Figure 3-17
Maxine's Production Possibilities Frontier
Daisy's Production Possibilities Frontier
-Refer to Figure 3-17.Suppose Daisy decides to increase her production of pies by 6.What is the opportunity cost of this decision?
A)8/3 tarts
B)4.5 tarts
C)8 tarts
D)10 tarts

Question

Figure 3-17
Maxine's Production Possibilities Frontier
Daisy's Production Possibilities Frontier  
-Refer to Figure 3-17.Suppose Daisy decides to increase her production of pies by 6.What is the opportunity cost of this decision?
A)8/3 tarts 
B)4.5 tarts 
C)8 tarts 
D)10 tarts

Quizplus · Accepted Answer

The opportunity cost of increasing pie production by 6 is the number of tarts that Daisy has to give up. If the production possibility frontier shows that 6 pies cost 8 tarts, then the opportunity cost is 8 tarts.

Figure 3-17 Maxine's Production Possibilities Frontier