The first two columns give the maximum daily amounts of beer and whiskey that Southern Ireland and Northern Ireland can produce when they completely specialize in one or another product.The last two columns give each country's consumption without trade. $$\begin{array} { l c c c c c c }
& \begin{array} { c }
\text { Maxirnumn } \
\text { beer } \
\text { production }
\end{array} & \begin{array} { c }
\text { Maxirnum } \
\text { whiskey } \
\text { production }
\end{array} & \begin{array} { c }
\text { Beer consumption } \
\text { without trade }
\end{array} & \begin{array} { c }
\text { Beer consurnption } \
\text { without trade }
\end{array} \
\begin{array} { l }
\text { Northem } \
\text { Irelard } \
\text { Southem }
\end{array} & 500 \mathrm { kegs } & 1500 \mathrm { kegs } & 300\mathrm { kegs } & 600 \text { bottles } \
\text { Ireland } & 1200 \mathrm { kegs } & \mathbf { 8 0 0 } \mathrm { kegs } & 600 \mathrm { kegs } & 400 \text { bottles }
\end{array}$$ What is the cost of Northern Ireland producing one additional bottle of whiskey?
A)0.33 kegs of beer
B)0.66 kegs of beer
C)1 kegs of beer
D)3 kegs of beer

Question

The first two columns give the maximum daily amounts of beer and whiskey that Southern Ireland and Northern Ireland can produce when they completely specialize in one or another product.The last two columns give each country's consumption without trade. $$\begin{array} { l c c c c c c } 
& \begin{array} { c } 
\text { Maxirnumn } \
\text { beer } \
\text { production }
\end{array} & \begin{array} { c } 
\text { Maxirnum } \
\text { whiskey } \
\text { production }
\end{array} & \begin{array} { c } 
\text { Beer consumption } \
\text { without trade }
\end{array} & \begin{array} { c } 
\text { Beer consurnption } \
\text { without trade }
\end{array} \
\begin{array} { l } 
\text { Northem } \
\text { Irelard } \
\text { Southem }
\end{array} & 500 \mathrm { kegs } & 1500 \mathrm { kegs } & 300\mathrm { kegs } & 600 \text { bottles } \
\text { Ireland } & 1200 \mathrm { kegs } & \mathbf { 8 0 0 } \mathrm { kegs } & 600  \mathrm { kegs } & 400 \text { bottles }
\end{array}$$ What is the cost of Northern Ireland producing one additional bottle of whiskey?
A)0.33 kegs of beer
B)0.66 kegs of beer
C)1 kegs of beer
D)3 kegs of beer

Quizplus · Accepted Answer

Northern Ireland can produce 1500 kegs of beer or 800 bottles of whiskey. So, the opportunity cost of producing one additional bottle of whiskey is 1500/800 = 1.875 kegs of beer.

The First Two Columns Give the Maximum Daily Amounts of Beer