Hello, just don\'t completely understand the reason why this question is wrong.
ID: 1152677 • Letter: H
Question
Hello, just don't completely understand the reason why this question is wrong.
From my understanding if Good A had a higher opportunity cost wouldn't that mean that you are giving up more by producing Good B. For example if you were if you produce 1 quantity of good B or 100 quanity of good A using the same amount of resources or time wouldn't that mean that good A could be produced more efficently than good B since you are making more with less resources. I don't understand how B can be more efficient when A has a higher opportunity cost, or is my understanding wrong?
Question 2 0/1 pts When workers in an economy increase certain skills such that the opportunity cost of producing good A increases, the PPC will contract to exclude points that were previously attainable You Answered shift outwards but also may change slope to reflect that A can be produced more efficiently with the new skills Correct answer shift outwards but also may change slope to reflect that B can be produced more efficiently with the new skills shift inwards but also may change slope to reflect that A can be produced more efficiently with the new skillsExplanation / Answer
Ans:
shifts outwards but may also change slope to reflect that B can be produced more efficiently with the new skills.
Analysis
when A has a higher opportunity cost, producing Good A means you are losing more.we can also understand that higher opportunity cost of Good A means producing Good B is more beneficial than producing good A.
Opportunity cost means the benefit forgone by not producing a good or service. In this case opportunity cost means Good B forgone to produce Good A. If Good A has higher opportunity cost it means benefit from producing Good B is higher than Good A (or) benefit from producing Good A is lower. This means with the existing resources more Good B can be produced than Good A.Since more Good B can be produced, so it is more efficient.
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