Question

Suppose the US can make 10 million roses or 100K computers with the same resources. Colombia can make 10 million roses or 30K computers. Colombia has a lower opportunity cost of making ________.

A. Roses
B. Computers
C. Both Roses and Computers
D. Neither Roses nor Computers

Answer 1

Colombia has a lower opportunity cost for producing computers because it sacrifices fewer computers than the US to produce the same number of roses.

Step-by-step explanation:

The student's question is about opportunity cost, which is a key concept in economics. Opportunity cost refers to what is given up when choosing one alternative over another. Specifically, the question compares the opportunity cost between the US and Colombia when it comes to producing roses and computers with the same resources. Given the information provided, Colombia can make 10 million roses or 30K computers, whereas the US can produce the same number of roses or 100K computers.

In order to determine which country has a lower opportunity cost for a given product, we must compare what quantity of the other product could be produced using the same resources. Colombia has a lower opportunity cost of producing computers because it only gives up the production of 10 million roses to produce 30K computers, while the US would have to forgo the opportunity to produce the same 10 million roses to make 100K computers. Therefore, Colombia forgoes fewer computers to produce the same number of roses compared to the US.

Therefore, Colombia has a lower opportunity cost of making computers than the US.