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Suppose Sri Lanka produces two commodies: wheat and cloth. Use the production possibility schedule to answer the questions below. A B C D E F

Suppose Sri Lanka produces two commodies: wheat and cloth. Use the production possibility schedule to answer the questions below.

A B C D E F G
Cloth (units) 0 10 20 30 40 50 60
Wheat (in tons) 100 95 85 70 50 30 0

  1. If the economy is currently producing at position E, answer the questions below.

  1. What is the opportunity cost of producing 10 more units of cloth? (2 Marks)

  1. What is the opportunity cost of producing 45 more tons of wheat? (2 Marks)

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