Below is a production possibilities table for capital goods and consumer goods. GOODS PRODUCED PRODUCTION ALTERNATIVES А в с DE Capital goods (in thousands) Consumer goods (in hundreds thousands) 3 12 40 36 28 16 a. Plot the data in the graph on the next page placing: Capital goods on the horizontal axis and • Consumer goods on the vertical axis. b. What are the four assumptions on which the production possibilities frontier is based? Calculate OC = [amount you give up / amount you get] c. If the economy is at point C, what is the cost of one more unit of capital good? d. If the economy is at point D, what is the cost of one more unit of capital good? e. Ifthe economy is at point D, what is the cost of one more unit of consumer good? f. If the economy is at point C, what is the cost of one more unit of consumer good?

Below is a production possibilities table for capital goods and consumer goods. GOODS PRODUCED PRODUCTION ALTERNATIVES А в с DE Capital goods (in thousands) Consumer goods (in hundreds thousands) 3 12 40 36 28 16 a. Plot the data in the graph on the next page placing: Capital goods on the horizontal axis and • Consumer goods on the vertical axis. b. What are the four assumptions on which the production possibilities frontier is based? Calculate OC = [amount you give up / amount you get] c. If the economy is at point C, what is the cost of one more unit of capital good? d. If the economy is at point D, what is the cost of one more unit of capital good? e. Ifthe economy is at point D, what is the cost of one more unit of consumer good? f. If the economy is at point C, what is the cost of one more unit of consumer good?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Problem 2 A Nation's residents can allocate their scarce resources either to producing consumption goods or to producing human capital (that is, providing themselves with training and education). The table below displays the production possibilities for this nation: See textbook, pages x - xx. Combination A B с D E F G H I J K Units of Consumption Goods 0 20 40 60 80 100 120 140 160 180 200 Units of Trained Individuals 100 90 80 70 60 50 40 Part b Does the PPC illustrate the law of increasing additional cost? Please explain. 30 20 10 0 Part a Plot this student's production possibilities curve (PPC). Use Excel to plot the curve. When done, copy the chart from Excel and insert it in the space provided below). Use Excel to plot the curve. When done, copy the chart from Excel and insert it in the space provided below. Part c Suppose that the nation's residents currently produce combination D (60 units of consumption goods and 70 units of trained individuals). What is the opportunity cost…
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a. 5000 Ob. 3000 с. 2000 d. 2500 QUESTION 22 Bob and Patrick do two things, cook fries and collect jellyfish. The table below shows how many units of each they can produce in a day. They have 5 days a week they can divide between the two tasks. Fries Jellyfish Bob 10 Patrick 4 What is the opportunity cost of fries for Patrick? a. 3/4 Ob. 2 Ос. 1/2 Od. 1 QUESTION 23
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