Table 3-36
-Refer to Table 3-36. What is Barbuda's opportunity cost of one umbrella?
A)3/5 towels
B)2/3 towels
C)3/2 towels
D)5/3 towels

Question

Table 3-36 
-Refer to Table 3-36. What is Barbuda's opportunity cost of one umbrella?
A)3/5 towels 
B)2/3 towels 
C)3/2 towels 
D)5/3 towels

Quizplus · Accepted Answer

To calculate the opportunity cost, we look at the ratio of the two goods for each country. For Barbuda, the ratio of towels to umbrellas is 3/2. This means they give up 2/3 of a towel for every umbrella they produce. Therefore, the opportunity cost of one umbrella for Barbuda is 2/3 towels. The best choice is option B.

Table 3-36 -Refer to Table 3-36. What Is Barbuda's Opportunity Cost of Opportunity