Answer:
Opportunity Cost (of 1 Table) = <u>6 Chairs</u> for Ken
Opportunity Cost (of 1 Table) = <u>3 Chairs</u> for Traci
Explanation:
Opportunity cost is the "cost" incurred when one foregoes the benefit associated with the best substitute choice
In this case, we have Ken and Traci
Both Ken and Traci can choose either to make Tables or Chairs
Opportunity Cost = Return on Most Profitable Investment Choice - Return on Investment Chosen to Pursue
<u>Ken</u>
Makes 3 Tables or 18 Chairs, this implies that for every Table made, 6 Chairs could have been made
Opportunity Cost (of 1 Table) = <u>6 Chairs</u>
<u>Traci</u>
Makes 8 Tables or 24 Chairs, this implies that for every Table made, 3 Chairs could have been made
Opportunity Cost (of 1 Table) = <u>3 Chairs</u>