Economics 9708 · AS & A Level · Scarcity, choice and opportunity cost

Scarcity, choice and opportunity cost — practice question

A farmer is able to produce both beef and lamb. The opportunity cost of producing 1 kilo of beef is 3 kilos of lamb. A kilo of beef sells for twice the price of a kilo of lamb. What should he do if his aim is to maximise his revenue?

  • Aconcentrate on beef production
  • Bconcentrate on lamb production
  • Cproduce beef and lamb in the ratio 3:2
  • Dproduce twice as much beef as lamb

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