Suppose That Opportunity Costs Are Constant and That Fred Can

question 252

Multiple Choice

Suppose that opportunity costs are constant and that Fred can either bake a maximum of six pies or three cakes in a day. Ethel can either produce a maximum of eight pies or two cakes in a day. Fred's opportunity cost to produce one cake is

• A) one-half pie.
• B) two pies.
• C) six pies.
• D) four pies.

---

Definitions:

Dissonance Analysis

The examination of inconsistencies between beliefs and behaviors, often applied in marketing to understand consumer decision-making processes.

Situation Assessment

An evaluation of the current state or conditions affecting a scenario or decision-making process.

Value Chain

A model that describes the full range of activities needed to create a product or service, from conception through distribution and after-sales service.

Overall Strategy

A comprehensive plan that outlines an organization's major goals and how it plans to achieve them over a long period.