Figure 3-3
Arturo's Production Possibilities Frontier
Dina's Production Possibilities Frontier
-Refer to Figure 3-3.If the production possibilities frontier shown for Arturo is for 100 hours of production,then how long does it take Arturo to make one burrito?
A)1/4 hour
B)1/3 hour
C)3 hours
D)4 hours

Question

Figure 3-3
Arturo's Production Possibilities Frontier
Dina's Production Possibilities Frontier  
-Refer to Figure 3-3.If the production possibilities frontier shown for Arturo is for 100 hours of production,then how long does it take Arturo to make one burrito?
A)1/4 hour 
B)1/3 hour 
C)3 hours 
D)4 hours

Quizplus · Accepted Answer

To find out how long it takes Arturo to make one burrito, we need to look at the slope of his production possibilities frontier. The slope of the curve is the opportunity cost of producing one more burrito. In this case, we can see that the curve goes from producing 0 burritos and 400 cups of coffee to producing 400 burritos and 0 cups of coffee. The vertical distance covered by the curve is 400 cups of coffee, and the horizontal distance is 400 burritos. Therefore, the slope is:

Opportunity cost = vertical distance / horizontal distance

Opportunity cost = 400 cups of coffee / 400 burritos

Opportunity cost = 1 cup of coffee / 1 burrito

So it takes Arturo 1/3 hour to make one burrito (i.e., the time it takes to make one cup of coffee). The best choice is B.

Figure 3-3 Arturo's Production Possibilities Frontier