To Find the Opportunity Cost of Producing One More Unit

question 100

Multiple Choice

To find the opportunity cost of producing one more unit of any product while on the production possibilities frontier requires

• A)setting the amounts of the two products equal to each other.
• B)setting the change in one product equal to the change in the other product.
• C)dividing the amount of the product forgone by the amount of the product gained.
• D)subtracting the change in the product whose production increased from the change in the product whose production decreased.
• E)None of these describes how to find opportunity cost.

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Definitions:

Dependent Variable

A variable in an experiment or study whose changes are determined by the presence or variation of one or more independent variables.

Independent Variable

Variables in a study that are presumed to influence or determine the dependent variable, essentially the cause in a cause-and-effect relationship.

Least Squares Estimate

A method of estimating the parameters of a linear regression line by minimizing the sum of the squares of the differences between the observed and predicted values.

Y-intercept

The point where a line crosses the Y-axis of a graph, indicating the value of the dependent variable when the independent variable is zero.