A clothing accessory company produces scarves and earrings. Below are the production possibility combinations it can produce with the resources that it has. Scarves Earrings a. Draw the production possibility curve in the space below. 10 0 9 50 8 90 7 120 6 145 5 165 4 185 3 200 2 215 1 225 0 230 b. Suppose technological advances increase production of both earrings and scarves by 10% without increasing costs. Demonstrate the effect of this innovation on the production possibility curve you drew above.

ENGR.ECONOMIC ANALYSIS
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Chapter1: Making Economics Decisions
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A clothing accessory company produces scarves and earrings. Below are the production possibility combinations it can produce with the resources that it has. Scarves Earrings a. Draw the production possibility curve in the space below. 10 0 9 50 8 90 7 120 6 145 5 165 4 185 3 200 2 215 1 225 0 230 b. Suppose technological advances increase production of both earrings and scarves by 10% without increasing costs. Demonstrate the effect of this innovation on the production possibility curve you drew above.

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