C) 3 D) 79 0 1 Use the following to answer question 3. Table: Production Possibi

Question

C) 3 D) 79 0 1 Use the following to answer question 3. Table: Production Possibilities for Machinery and Petroleum Countries United States Mexico Machinery (M) units) 80 60 Petroleum (P) (units) 40 180 3. (Table: Production Possibilities for Machinery and Petroleum) Look at the table Production Possibilities for Machinery and Petroleum. The table shows the number of units of machinery each country would have to forgo in order to produce additional petroleum, assuming constant costs at its current level of production. Based on the information in the table, it is true that: A) the opportunity cost of machinery is more in the United States than in Mexico. B) machinery costs are the same in the United States and in Mexico. C) the opportunity cost of machinery is less in the United States than in Mexico. D) the opportunity cost of petroleum is less in the United States than in Mexico. 4. An urbanized country has 100 million workers living on 100 square miles of land. A country that is principally rural has 1 million workers living on 10 square miles of land. From this information we know that the urbanized country is relative to the rural country. A) land-abundant B) labor-abundant C) land-intensive D) labor-intensive

Explanation / Answer

First question is answered below

3.

In US,

80 M = 40 P

So, 1 M = 0.5 P or 1 P = 2 M

In Mexico,

60 M = 180 P

So, 1 M = 3 P or 1 P = 0.33 M

Correct option: (c)

Reason: This is because opportunity cost of machinery is 0.5 Petrol in US and 3 Petrol in Mexico.

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