Barb can produce 10 apples or 10 oranges on her farm, while Jim can produce 20 apples or 40oranges. Is there a basis for trade?O yes, they have different opportunity costs of productionO They should give up apples and oranges and grow kalenone of theseO No. Jim produces more apples and oranges

Answered: Barb can produce 10 apples or 10…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Related questions

Question

Barb can produce 10 apples or 10 oranges on her farm, while Jim can produce 20 apples or 40
oranges. Is there a basis for trade?
O yes, they have different opportunity costs of production
O They should give up apples and oranges and grow kale
none of these
O No. Jim produces more apples and oranges

Expert Solution

Step 1

What is OPPORTUNITY COST (chance expenses)

Financial backers are constantly confronted with alternatives concerning how to put away their cash to get the most noteworthy or most secure return. The financial backer's chance expense addresses the expense of an inescapable other option. Assuming you pick one option over another, the expense of picking that option turns into your opportunity cost.

Opportunity costs are a factor in choices made by customers as well as by numerous organizations, also. Organizations will consider opportunity cost as they settle on choices about creation, using time effectively and capital assignment.