In a Single Year,the Netherlands Can Raise 100 Tonnes of Beef

question 135

Multiple Choice

In a single year,the Netherlands can raise 100 tonnes of beef or produce 1 000 boxes of tulips.In the same growing season,Belgium can raise 50 tonnes of beef or produce 750 boxes of tulips.In autarky,the opportunity cost of 1 tonne of beef in the Netherlands is:

• A) 100 tonnes of beef.
• B) 1 000 boxes of tulips.
• C) 10 boxes of tulips.
• D) 0.1 box of tulips.

---

Definitions:

Price Index

A statistical measure that examines the weighted average of prices of a selected basket of goods and services over a period, used to track inflation or deflation.

Social Security Payments

Government-provided financial assistance to people with inadequate or no income, especially the elderly or disabled.

Real Interest Rate

The rate of interest an investor expects to receive after allowing for inflation, reflecting the true cost of borrowing and the real yield on an investment.

Purchasing Power

A currency's value measured by the volume of goods or services purchasable with one monetary unit.