Use the Following Scenario to Answer the Next Eight Questions

question 24

Multiple Choice

Use the following scenario to answer the next eight questions:
Rosa and Dirk produce basketballs and footballs. Rosa can produce six basketballs per hour or two footballs per hour. Dirk can produce three basketballs per hour or four footballs per hour.
-Based on the scenario,Dirk's opportunity cost of one basketball is:

• A) 1 1/3 footballs.
• B) 1 football.
• C) 3/4 football.
• D) 4 footballs.
• E) 3 footballs.

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Definitions:

Price Ceiling

A government-imposed limit on the price charged for a product, intended to prevent prices from rising too high.

Producer Surplus

The difference between what producers are willing to accept for a good versus what they actually receive, often due to market prices being higher.

Substitutes

Goods or services that can be used in place of each other, allowing consumers to switch if there is a change in price or availability.

Producer Surplus

The difference between the amount that producers are willing and able to sell a good for and the actual amount they receive due to market dynamics.