Practice Question $2$

Take a stab at this question $($you$\text{'}$ll need to do some multiplication$)$ Every day, $500,000$ drivers in Los Angeles incur an additional $30$ minutes of traffic delays when commuting by car to their jobs. In Boston, the delays amount to $45$ minutes for $200,000$ drivers. If the price of time is $$15/$hour in Los Angeles and $$25/$hour in Boston, which city incurs the largest opportunity cost?

A$.$ Los Angeles

B$.$ Boston

C$.$ Neither

Practice Question $4$

An economy is composed entirely of two equally sized farms A and $B$ producing both eggs and milk. Farm $A$ is better at producing eggs than Farm $B$ which is better at producing milk. Then in order to maximize output, Farm A should:

A$.$ Abandon the production of milk to fully specialize in the production of eggs and then trade with Farm $B$ for milk.

B$.$ Produce both eggs and milk on its own and sell its excess eggs to $B$ for additional milk.

C$.$ Reduce its production of eggs in order to commit resources to learn how to better produce milk.