Chapter 2, Problem 22P

To determine

what is the opportunity cost of producing million more tablet devices and moving to production combination F

Concept introduction:

Production possibility frontier: The production possibility curve is a curve showing the maximum output can be produced with the given amount resources. Any point on the production possibility curve would be an efficient one. The points under the production possibility curve show the underutilization of resources.

Opportunity cost: The opportunity cost is defined as the next best activity forgone. This means that if we have to produce more capital goods instead of consumer goods we have to divert more resources for producing capital goods, so there is an opportunity cost for producing more capital goods instead of consumer goods