Question

At most, a country could produce 20,000 units of good a or 5,000 units of good b. What is the opportunity cost of producing one unit of good b in terms good a?.

Answer 1

The opportunity cost of producing one unit of good B in terms of good A is 4 units of good A.

Step-by-step explanation:

The opportunity cost of producing one unit of good B in terms of good A can be calculated by dividing the maximum units of good A that could be produced by the maximum units of good B that could be produced. In this case, the country can produce at most 20,000 units of good A and 5,000 units of good B. Therefore, the opportunity cost of producing one unit of good B in terms of good A is:

20,000 units of good A / 5,000 units of good B = 4 units of good A per unit of good B

This means that for every unit of good B produced, the country must give up the opportunity to produce 4 units of good A.