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Basics about Opportunity Cost

 
 
Reply Thu 24 Jan, 2013 04:49 am
In a bartering market, I have a grapefruit and have two choices only: either A or B
choice A: grapefruit exchange for 5 apples
choice B: grapefruit exchange for 3 bananas

Cost of taking choice A will be 3 bananas. That's simple and direct.

Now, if choice A is changed: number of apples changed from 5
to 6. What will be the new Op. Cost?
to 4. What then?

Furthermore, choice A is changed as:
$1 + grapefruit for 5 apples; What will be the new Op. Cost?
grapefruit for 5 apples + $1; What then?

Thanks in advance.

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CalvinKong
 
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Reply Thu 24 Jan, 2013 07:41 am
@CalvinKong,
May be I re-phrase my question:

In a bartering market, I have a grapefruit and have two choices only: either A or B
choice A: grapefruit exchange for 5 apples
choice B: grapefruit exchange for 3 bananas

Op. Cost of taking choice A will be 3 bananas. That's simple and direct.

Now, what will be the new Op. Cost if choice A is changed to:
(i) a grapefruit exchange for 6 apples
(ii) a grapefruit exchange for 4 apples
(iii) ($1 + one grapefruit) exchange for 5 apples
(iv) a grapefruit exchange for (5 apples + $1)

Thanks in advance again.
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