No Bull Economics Lessons

Macroeconomics & Microeconomics Concepts You Must Know

Basic Economic Concepts (4 of 10)

Question 4:
Suppose Alex opens his own custom woodworking business. If Alex can build one jewelry box in 35 hours or two gun racks in 70 hours. What is his opportunity cost of producing one jewelry box?

A.  1 gun rack
B.  0 gun racks 
C.  1/2 gun rack 
D.  2 gun racks

Scroll down for correct answer


Correct Answer:  A, 1 gun rack.  Since Alex can build one gun rack in 35 hours, his opportunity cost of producing one jewelry box is 1 gun rack (35/35).

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