Answer to Question #235119 in Macroeconomics for Eve

Question

what is the opportunity cost of producing an additional bowling ball measured in terms of forgore bicyles in eastern leisureland?

Answer 1

The eastern region of Leisureland can, if it devotes all its resources to bicycle production,

produce 400 bicycles per month. Alternatively, it could devote all its resources to bowling balls

and produce 100 per month—or it could produce any combination of bicycles and bowling balls

lying on a straight line between these two extremes.

Opportunity cost of producing 100 bowling balls = 400 bicycles to get opportunity cost of

producing 1 extra bowling ball, we divide 400 bicycles by 100 balls 400/100 = 4 1 extra

ball will cost 4 bicycles