To determine the opportunity cost of producing 1 metric ton of beef in Peru using the production possibilities frontier (PPF), we need to know how much fruit Peru could produce instead of a given amount of beef.
Assuming the PPF is linear, the opportunity cost can be derived from the slope of the PPF. If the PPF shows that producing a certain number of beef results in a loss of tons of fruit, we can calculate the opportunity cost by finding the ratio of the change in fruit production lost to the change in beef production gained.
Since the specific values from the PPF in the exhibit are not provided here, I can guide you through how to calculate it once you have those numbers:
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Determine how much fruit (in metric tons) is forgone when increasing beef production by 1 metric ton.
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The opportunity cost of producing 1 metric ton of beef is given by:
\[ \text{Opportunity Cost (in tons of fruit)} = \frac{\text{Tons of fruit lost}}{\text{Tons of beef gained}} \]
For example, if the PPF indicates that increasing beef production by 1 ton means reducing fruit production by 3 tons, then the opportunity cost of producing 1 metric ton of beef would be 3 tons of fruit.
Based on common interpretations of opportunity costs in production scenarios, if you can provide the relevant details from Exhibit, I can help you identify the correct answer more specifically. That said, without that data, I can’t determine which option (a, b, c, d, or e) is correct. You need to match your findings to the closest option available.