1. The table below is a list of the maximum combinations of rice and beans that the Island of Utopia can produce. combination rice beans A 1200 0 B 1100 1200 C 900 2000 D 500 2600 E 200 2900 F 0 3000 (i) Draw the production possibility frontier (PPF) for the Island of Utopia I (ii) Explain what a point on the line shows (for example point A or B, etc). Full answer required. ii) Assume the economy starts at point D and moves to point B. Explain what is happening here. Calculate the opportunity cost.

1. The table below is a list of the maximum combinations of rice and beans that the Island of Utopia can produce. combination rice beans A 1200 0 B 1100 1200 C 900 2000 D 500 2600 E 200 2900 F 0 3000 (i) Draw the production possibility frontier (PPF) for the Island of Utopia I (ii) Explain what a point on the line shows (for example point A or B, etc). Full answer required. ii) Assume the economy starts at point D and moves to point B. Explain what is happening here. Calculate the opportunity cost.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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A ng.cengage.com + Welcome to Johnston Community College Bb Support Materials and Text Chapters Two and Three - .. * MindTap - Cengage Learning >> CENGAGE MINDTAP Q Search this course Homework (Ch 02) 4. Shifts in production possibilities Suppose Japan produces two types of goods: agricultural and capital. The following diagram shows its current production possibilities frontier for wheat, an agricultural good, and cars, a capital good. A-Z Drag the production possibilities frontier (PPF) on the graph to show the effects of a technological advance in medicine that allows workers to live longer and have extended careers. Note: Select either end of the curve on the graph to make the endpoints appear. Then drag one or both endpoints to the desired position. Points will snap into position, so if you try to move a point and it snaps back to its original position, just drag it a little farther. (?) 360 300 PPF 240 180 At 120 60 PPF 10 20 30 40 50 60 WHEAT (Millions of bushels) O 9 2 9 O E…
Envelopes (per hour) 200 160 Deb's PPF 120 Pete's PPF 80 40 40 80 120 160 200 Packets (per hour) Deb and Pete have volunteered to help their favorite charity mail out fundraiser information. The figure above shows their production possibilities frontiers for assembling packets and stuffing envelopes. Which of the following statements is correct? Deb has an absolute advantage in both assembling packets and stuffing A) envelopes. B) Deb has a comparative advantage in stuffing envelopes. Deb has a comparative advantage in both assembling packets and stuffing C) envelopes. Pete has an absolute advantage in both assembling packets and stuffing D) envelopes.
250 A 225 200 175 150 125 100 75 E 50 25 20 40 60 80 100 Oil Drills On the PPF shown in the figure above, which points represent inefficient production points? Select one: a. points C and E b. points D and A c. points B and D d. points A and E Solar Panels
4. Suppose you have midterms in economics and psychology tomorrow, and you have 6 hours left to study. The table below shows your expected exam scores, given the amount you study for each exam. Hours spent studying economics 0 1 2 3 4 5 6 Economics exam score 40 60 a. 70 75 79 84 88 Hours spent studying Psychology 0 1 2 3 4 5 6 Psychology exam score 50 65 75 83 90 93 94 a) Draw your production possibilities frontier (PPF) to illustrate your study options. If you have already spent 5 hours studying for psychology, what is the opportunity cost of increasing your psychology grade by one more point? X b) If your goal is to maximize your combined exam scores, how many hours should you spend studying each subject? c) If, instead, a club meeting gets canceled and gives you 7 hours to study, how would this change your production possibilities frontier? Illustrate this change on your graph from part 5. Graph the following demand curve for the loose-leaf Stevenson/Wolfers Principles of Economics…
Do i, ii, iii
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1. Name three combinations of corn and soybean that would be on the line, on the Production Possibilities Frontier. 2. Name three combinations of corn and soybean that would be inside the Production Possibilities Frontier (to the lower left of the line). 3. Name three combinations of corn and soybean that would be beyond the Production Possibilities Frontier (to the upper right of the line). 4. Consider now a third 100-acre field. Field 3 corn yields are 120 bushels per acre, and soybean yields are also 120 bushels per acre. a. What is the maximum amount of corn that could be grown on this field? b. What is the maximum amount of soybean that could be grown on this field? c. What is the opportunity cost, on this field, of growing a bushel of corn? d. What is the opportunity cost, on this field, of growing a bushel of soybean? e. Draw the Production Possibilities Frontier for this third field.
This diagram represents the production possibility frontier of a Country. Point A has coordinates (0 S; 1.000 T) Point B has coordinates (2.000 S;OT) Point C has coordinates (1,200 5; 600 T) You are told that P(S)/P(T) is 0.5. What is the production point that is most likely to be chosen in equilibrium between A, B and C? GO 8 B S
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Draw a production possibilities frontier diagram for a farm able to produce corn or soybeans. What does a production possibilities frontier illustrate?
Problem 3 (a) Suppose that when Jane is presented with the following two menus, her choices from them are as below 2 • When presented with the menu {6 units of apples, 5 units of bananas}, Jane chooses 6 units of apples. • When presented with the menu {7 units of oranges, 5 units of bananas}, Jane chooses 5 units of bananas. Suppose that Jane is then presented with the menu {7 units of oranges, 6 units of apples} What must Jane's choice be from this menu so that her behavior conforms to the axioms of rational choice? Explain. (b) Suppose that Frederick choices from the following menus are as follows • For any e > 0³, out of the menu {(4 + ɛ apples and 3 bananas), (5 oranges and 3 bananas)}, Frederick chooses (4 + ε apples and 3 bananas). • Out of the menu {(4 apples and 3 bananas), (5 oranges and 3 bananas)}, Fred- erick chooses (5 oranges and 3 bananas) What axiom of rational choice does Frederick's behavior evidently violate? Discuss.
3. Efficiency in the production possibilities model Suppose Germany produces only two goods: corn and tablets. The following graph shows Germany's current production possibilities frontier, along with six output combinations represented by black points (plus symbols) labeled A to F. A B с D E TABLETS (Millions) LL 100 F 80 60 9 20 0 + 0 PPF 0+ Point Inefficient Efficient Unattainable 20 Complete the following table by indicating whether each point represents output combinations that are inefficient, efficient, or unattainable. Check all that apply. U E U *C * 8 40 60 CORN (Millions of bushels) xx DO D 80 100