Assume a society can produce either olives or grapes. If the marginal rate of transformation of bushels of olives into bushels of grapes is 0.2, then the opportunity cost of grapes is
A. the additional 0.2 gallons of olives that can be produced.
B. the 0.2 bushels of olives that must be forgone.
C. the 5 bushels of olives that must be forgone.
D. the 5 bushels of grapes that must be forgone.
Answer: B
You might also like to view...
According to the Phillips curve diagram, if a central bank disinflates what ultimately happens to the unemployment rate?
Which statement is an example of substitute goods affecting demand?
a. A bumper crop of cotton lowers the price of cotton clothing. Sales of silk shirts decrease. b. As laptop computer sales increase, so do the sales of computer cases. c. An automobile maker lays off thousands. Sales of electronic goods in that city fall. d. Hi-tech companies lure people to a region. Demand for housing rises.
Expansionary monetary policy will:
A. Reduce the lending capacity for banks. B. Raise interest rates. C. Encourage people to borrow more money. D. Reduce the equilibrium price level.
A market with many sellers, some influence over price, low barriers to entry, a differentiated product, and non-price competition often taking the form of advertising is known as
A) perfect competition. B) monopolistic competition. C) oligopoly. D) monopoly.