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

Scarcity, choice and opportunity cost — practice question

A farmer is able to grow both wheat and barley at constant production costs. The opportunity cost of 1 kilo of wheat is 1.5 kilos of barley. A kilo of wheat sells for twice the price of a kilo of barley. What should the farmer choose in order to maximise revenue?

  • AConcentrate on barley production.
  • BConcentrate on wheat production.
  • CProduce wheat and barley in the ratio 2 : 1.
  • DProduce wheat and barley in the ratio 3 : 2.

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