-Agnes Can Produce Either 1 Unit of X or 1

question 322

Multiple Choice

-Agnes can produce either 1 unit of X or 1 unit of Y in an hour, while Brenda can produce either 2 units of X or 4 units of Y in an hour. The opportunity cost of producing a unit of X is

• A) 1 unit of Y per unit of X for Agnes and 2 units of Y per unit of X for Brenda.
• B) 1 unit of Y per unit of X for Agnes and 1/2 unit of Y per unit of X for Brenda.
• C) 1 hour for Agnes and 1/2 hour for Brenda.
• D) 1 hour for Agnes and 2 hours for Brenda.

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Definitions:

Market Imperfection

A situation where the assumptions of perfect competition are not met, leading to market failure.

Poor Information

A situation characterized by inaccuracies, unreliability, or incompleteness of data that affects decisions and outcomes.

Expenditures on Education

The amount of money spent on educational institutions, materials, and programs by individuals, families, and governments.

Future Earnings

The expected amount of money that an individual or entity will receive for its labor or investments in the future.