Question

Examine the table the production possibilities for tractors and crude oil. the table shows the maximum amount of tractors and crude oil that each country can produce when they devote all of their resources to the production of that good. the opportunity cost in mexico of producing 40 tractors is _____ (thousand) barrels of crude oil.

Answer 1

The opportunity cost in Mexico of producing 40 tractor is 120,000 barrels of crude oil.
The opportunity cost refers to the alternative that has to be given up in order to enjoy another option. In the table given in this question, the opportunity cost of Mexico producing 40 tractors is the 120,000 barrel of crude oil, which it has to forego.