Table 3-6 Assume That Maya and Miguel Can Switch Between Producing Mixers

question 193

Multiple Choice

Table 3-6
Assume that Maya and Miguel can switch between producing mixers and producing toasters at a constant rate.

-Refer to Table 3-6.The opportunity cost of 1 toaster for Maya is

• A) 0.625 mixers.
• B) 1.6 hours of labor.
• C) 1.6 mixers.
• D) 8 hours of labor.

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Definitions:

Marginal Private Benefit

The additional benefit received by the consumer or producer from consuming or producing one more unit of a good or service.

Marginal Social Cost

The additional cost imposed on society as a whole from producing one more unit of a good or service.

Socially Optimal

is a condition or outcome in which the allocation of resources maximizes the overall benefit to society.

Nonexcludable

A characteristic of a good whereby it is difficult or impossible to prevent people who have not paid for it from consuming or using it.