Question

Esther and Albert produce hamburgers and hot dogs. Esther can produce six hamburgers per hour or four hot dogs per hour. Albert can produce three hamburgers per hour or one hot dog per hour. Based on the scenario, Albert’s opportunity cost of one hamburger is ________ hot dog(s).

Answer 1

Answer: 1/3 hot dog per hour

Explanation: Opportunity cost is a term used by economists to mean what you have to forego in order to choose something else. Opportunity cost refers to what you have to sacrifice to buy what you want in terms of other services or goods.

In this case Albert can produce 3 hamburgers in one hour, and also he can produce 1 hot dog in 1 hour

it can expressed:

1 hot dog = 1 hour

3 hamburger= 1 hour

Equating both equations and simplifying it gives:

1 hamburger = 1/3 hot dogs