Question

Beth and Eleanor are roommates. They spend most of their time studying, but they also make time for their favorite activities: making pizza and brewing root beer. Beth takes 5 hours to brew a gallon of root beer and 3 hours to make a pizza. Eleanor takes 8 hours to brew a gallon of root beer and 4 hours to make a pizza. What is Beth's opportunity cost of making a pizza in terms of root beer?

1) 2/5 gallon of root beer
2) 3/5 gallon of root beer
3) 4/5 gallon of root beer
4) 5/5 gallon of root beer

Answer 1

Beth's opportunity cost of making a pizza is 3/5 gallon of root beer, since this is the amount of root beer she could have produced in the time it takes to make a pizza.

Step-by-step explanation:

Beth's opportunity cost of making a pizza in terms of root beer is determined by comparing the amount of root beer she could have brewed in the time it takes her to make a pizza. Beth takes 5 hours to brew one gallon of root beer. Since she can make a pizza in 3 hours, she sacrifices 3/5 of the time she needs to brew a gallon of root beer (3 hours for pizza/5 hours for root beer = 3/5 of a gallon). Thus, Beth's opportunity cost of making a pizza is 3/5 gallon of root beer.