A-LevelEconomicsBasic economic ideas and resource allocation9708/12 · Oct/Nov 2013 · Q31 Mark
A farmer can produce both beef and lamb. The opportunity cost of a kilo of beef is three kilos of lamb. The price of a kilo of beef is twice that of lamb. What should he do if his aim is to maximise his revenue?
Aconcentrate on beef production
Bconcentrate on lamb production
Cproduce beef and lamb in the ratio 3:2
Dproduce twice as much as lamb
✓ Correct answer
B: concentrate on lamb production
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