Post Utme Abu 2024 Economics Question 22

Practice objective / multiple choice question 22 from the 2024 Post Utme Abu Economics examination.

Post Utme Abu 2024 Economics Objective / Multiple Choice
Question 22 POST_UTME_ABU • 2024 • ECONOMICS • objective

A firm is considering two different production processes to manufacture a product. Process A requires an initial investment of ₦1,000,000 and generates a profit of ₦200,000 per year. Process B requires an initial investment of ₦500,000 and generates a profit of ₦300,000 per year. What is the opportunity \cost of choo\sing Process A over Process B?

Answer Options

A. The opportunity \cost is the difference in initial investment between the two processes.
Correct Answer B. The opportunity \cost is the difference in profit between the two processes.
C. The opportunity \cost is the difference in the number of years it takes to break even between the two processes.
D. The opportunity \cost is the difference in the total profit generated by the two processes over a 5-year period.
Correct Answer
B
Correct Option:
The opportunity \cost is the difference in profit between the two processes.

About This Question

This is Post Utme Abu 2024 Economics Question 22. It is one of the objective questions from the 2024 Post Utme Abu Economics examination.

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