Learning Path
Question & Answer1
Understand Question2
Review Options3
Learn Explanation4
Explore TopicChoose the Best Answer
A
The value of 10 units of good Y that could have been produced instead
B
The additional resources required to produce good X
C
The amount of time spent on production
D
The total production capacity of both goods combined
Understanding the Answer
Let's break down why this is correct
Answer
Opportunity cost is what you give up when you choose one option over another. In this case, if you decide to produce good X, which allows you to make 12 units, the opportunity cost is the 10 units of good Y that you could have produced instead. This means that by choosing to focus on good X, you are sacrificing the chance to create good Y. For example, if you have limited resources and choose to spend them on good X, you miss out on the benefits of having those 10 units of good Y available. Therefore, the opportunity cost of producing good X is the value of the good Y you are not making.
Detailed Explanation
Opportunity cost is what you give up when you make a choice. Other options are incorrect because This answer confuses resources with opportunity cost; Time spent is not the same as opportunity cost.
Key Concepts
Opportunity Cost
Production Possibilities Curve
Resource Allocation
Topic
Analyzing Opportunity Costs
Difficulty
medium level question
Cognitive Level
understand
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