In a month, Caleb can produce a maximum of either 30 bushels of pears or 15 bushels of apples, or any linear combination in between. Similarly, Diane can produce a maximum of either 20 bushels of pears or 5 bushels of apples, or any linear combination in between. 1st attempt Part 1 What is the opportunity cost for Caleb to produce one more bushel of apples in terms of pears? One bushel of apples equals bushels of pears. What is the opportunitycost for Diane to produce one more bushel of apples in terms of pears? One bushel of apples equals bushels of pears.

Question

Danna Jacobs

Business

26 November, 09:56

In a month, Caleb can produce a maximum of either 30 bushels of pears or 15 bushels of apples, or any linear combination in between. Similarly, Diane can produce a maximum of either 20 bushels of pears or 5 bushels of apples, or any linear combination in between. 1st attempt Part 1 What is the opportunity cost for Caleb to produce one more bushel of apples in terms of pears? One bushel of apples equals bushels of pears. What is the opportunitycost for Diane to produce one more bushel of apples in terms of pears? One bushel of apples equals bushels of pears.

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Answers (1)

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Allyson Walker · Answer 1

One bushel of apples equals 2 bushels of pears. (opportunity cost for Caleb)

One bushel of apples equals 4 bushels of pears. (opportunity cost for Diane)

Explanation:

In this example, opportunity cost is simply calculated by dividing the maximum capacity for pears with the maximum capacity for apples. In other words, it symbolizes the loss an individual gets by opting for one decision among two options. Caleb has two times smaller opportunity cost than Diane. Therefore, if they had to specialize in producing one good, Caleb should go for apples, while Diane should go for pears.