Figure 3-19
Chile's Production Possibilities Frontier
Colombia's Production Possibilities Frontier
-Refer to Figure 3-19.Chile's opportunity cost of one pound of coffee is
A)3/4 pound of soybeans and Colombia's opportunity cost of one pound of coffee is 1/2 pound of soybeans.
B)3/4 pound of soybeans and Colombia's opportunity cost of one pound of coffee is 2 pounds of soybeans.
C)4/3 pounds of soybeans and Colombia's opportunity cost of one pound of coffee is 1/2 pound of soybeans.
D)4/3 pounds of soybeans and Colombia's opportunity cost of one pound of coffee is 2 pounds of soybeans.

Question

Figure 3-19
Chile's Production Possibilities Frontier
Colombia's Production Possibilities Frontier  
-Refer to Figure 3-19.Chile's opportunity cost of one pound of coffee is
A)3/4 pound of soybeans and Colombia's opportunity cost of one pound of coffee is 1/2 pound of soybeans. 
B)3/4 pound of soybeans and Colombia's opportunity cost of one pound of coffee is 2 pounds of soybeans. 
C)4/3 pounds of soybeans and Colombia's opportunity cost of one pound of coffee is 1/2 pound of soybeans. 
D)4/3 pounds of soybeans and Colombia's opportunity cost of one pound of coffee is 2 pounds of soybeans.

Quizplus · Accepted Answer

The opportunity cost of one pound of coffee is the amount of soybeans that must be given up to produce one pound of coffee. In Chile, the opportunity cost of one pound of coffee is 3/4 pound of soybeans. In Colombia, the opportunity cost of one pound of coffee is 1/2 pound of soybeans. Therefore, choice A is the correct answer.

Figure 3-19 Chile's Production Possibilities Frontier