Table 3-6 -Refer to Table 3-6. What Is the Opportunity Cost of the Opportunity

question 91

Multiple Choice

Table 3-6

-Refer to Table 3-6. What is the opportunity cost of 1 unit of bread in Spain?

• A)4 cheeses.
• B)2 cheeses.
• C)1 cheese.
• D)1/4 cheese.

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Definitions:

Returns to Scale

The variation in production output resulting from a proportional alteration of all input factors in the manufacturing process.

Constant-Cost Industry

An industry in which the input prices and production costs remain constant as the industry output changes.

Long-Run Equilibrium

A state in which all firms in an industry are producing at their minimum long-run average cost and are earning normal profits.

Units of Output

The measurable amount of goods or services produced by a company or industry.