Question

Question

At most, a country could produce 20,000 units of Good A or 5,000 units of Good B. What is the opportunity cost of producing one unit of Good B in terms Good A?(1 point)
Responses

14
unit of Good B
1 fourth unit of Good B

14
unit of Good A
1 fourth unit of Good A

4 units of Good B
4 units of Good B

4 units of Good A

Answer 1

To calculate the opportunity cost of producing one unit of Good B in terms of Good A, we need to determine how many units of Good A are being sacrificed when we produce Good B.

Given:

• The country can produce a maximum of 20,000 units of Good A or 5,000 units of Good B.

First, we need to determine how many units of Good A are produced per unit of Good B. The opportunity cost can be calculated using the following formula:

\[ \text{Opportunity Cost of 1 unit of Good B} = \frac{\text{Total units of Good A}}{\text{Total units of Good B}} \]

Substituting in the values:

\[ \text{Opportunity Cost of 1 unit of Good B} = \frac{20,000 \text{ units of Good A}}{5,000 \text{ units of Good B}} = 4 \text{ units of Good A} \]

Thus, the opportunity cost of producing one unit of Good B is 4 units of Good A.

Therefore, the correct response is:

4 units of Good A.