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JAMB Economics 1983 Question 7

Question 7

Basic Concepts

Production possibilities (alternatives)
Alternative: P | Q | R | S | T
Units of shelter: 5 | 4 | 3 | 2 | 0
Units of food: 0 | 5 | 9 | 12 | 15
Based on the above production possibilities table, the real cost of a unit of food when alternative R is selected is

  1. A.one unit of shelter
  2. B.three units of shelter
  3. C.one third of a unit of shelter
  4. D.six units of shelter
  5. E.two units of shelter.
Show the answer and explanation

Answer: C (one third of a unit of shelter)

Explanation

Going from R to S, one unit of shelter is given up to get 3 more units of food (9 to 12), so each unit of food costs one third of a unit of shelter.