Consider the figure at the right. This economy moved from production possibilities boundary A to production possibilities boundary B because O A. the opportunity cost of hot dogs in terms of books increased. O B. the technology used to produce books improved while the technology used to produce hot dogs remained unchanged. O C. there has been growth in productive capacity. O D. there has been a decline in productive capacity. O E. the opportunity cost of books in terms of hot dogs increased. Quantity of Books PPBA Quantity of Hot Dogs PPBB Q

Consider the figure at the right. This economy moved from production possibilities boundary A to production possibilities boundary B because O A. the opportunity cost of hot dogs in terms of books increased. O B. the technology used to produce books improved while the technology used to produce hot dogs remained unchanged. O C. there has been growth in productive capacity. O D. there has been a decline in productive capacity. O E. the opportunity cost of books in terms of hot dogs increased. Quantity of Books PPBA Quantity of Hot Dogs PPBB Q

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Adjust the production possibilities frontier (PPF) to show the economy's new production possibilities after the deterioration of infrastructure. 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. QUANTITY OF CARS (Millions) 24 16 0 0 O 5 OO PPF 10 QUANTITY OF COMPUTERS (Millions) 15 Suppose society faces a broad tradeoff between allocating resources to the production of investment goods (computers) and consumption goods (cars) before the deterioration of infrastructure described above. PPF Which of the following events would be most likely to lead to the deterioration of infrastructure you just illustrated? Increasing production of investment goods and decreasing production of consumption goods Decreasing production of investment and consumption goods Increasing…
If Korea is currently producing at efficiency, and it proceeds to increase the production of missiles, then, as long as nothing else changes, its: O A. Production-possibilities curve will shift outward. O B. Production-possibilities curve will shift inward. O c. Production of non-military goods will increase. O D. Production of non-military goods (civilian goods) will decrease.
Please choose the correct answer?
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Wine (thousands of bottles per year) The figure shows the production possibility frontier for a country. Suppose the country is producing at point E. What would be the opportunity cost to increase the production of wine to 9 thousand bottles? B 15 12 O A. 12 tons of rice B. 3 tons of rice D 9 O C. 15 thousand bottles of wine 6. D. Nothing, it is a free lunch 3 E. 9 thousand bottles of wine 12 15 Rice (tons per year) 3 6
It takes Andy 45 minutes to complete a load of laundry and 15 minutes to wrap a present. It takes Bob 60 minutes to complete a load of laundry and 30 minutes to wrap a present. Which of the following statements is true? Select one : O A. Bob's opportunity cost of doing a load of laundry is wrapping 3 presents. O B. Bob has a comparative advantage in doing laundry. O C. Bob has a comparative advantage in wrapping a present. O D. Andy's opportunity cost of wrapping a present is doing 3 loads of laundry. O E. Bob has an absolute advantage in doing laundry.
2. Suppose that Happy Land produces only two goods-food and suntan oil. Its production possibilities are: Food (pounds per month) 300 200 100 0 Active Land also produces only food and suntan oil, and its production possibilities are: Food (pounds per month) 150 100 50 0 Draw the two PPFs Suntan oil (gallons per month) 0 50 100 150 Suntan oil (gallons per month) 0 100 2000 300 a. What are the opportunity costs of food and suntan oil in Happy Land? b. Why are the opportunity costs the same at each output level? c. What are the opportunity costs of food and suntan oil in Active Land? d. If each nation specialized where they have a comparative advantage; and then traded, find the acceptable ranges for trade. 1 pound of food would have to trade between which values of suntan oil? 1 pound of suntan oil would have to trade between which values of food? e. If each nation produces where they have a comparative advantage, and the terms of trade are 50 pounds of food for 75 gallons of suntan oil,…
In the production possibilities frontier depicted in the figure above, what is the opportunity cost of increasing the production of bananas from two million pounds to three million pounds? Use a production possibilities frontier to analyze opportunity costs and trade-offs. Hats (millions per year) 5 4 3 2 1 0 1 2 3 4 5 6 Bananas (millions of pounds per year) O 1/2 million hats 1 million hats O 2 million hats O 3 million hats
Refer to the production possibility frontiers for two friends Frodo and Sam who can both produce Ice creams and Jelly beans. Frodo's maximum production of Ice creams is 500 with no Jelly beans, or 2,000 Jelly beans with no Ice creams. Sam's maximum production of Ice creams is 600 with no Jelly beans, or 1,200 Jelly beans with no Ice creams. ICE CREAMS ICE CREAMS 600 500 1200 JELLY BEANS 2000 JELLY BEANS Frodo' PPF Sam's PPF Answer briefly these TWO questions in the box space provided below. Part A: Assuming efficient production without trade, derive the maximum amount of Jelly beans that can be produced by Sam along with 300 Ice creams. Describe your steps in detail. Part B: Assume that Frodo and Sam agree to specialize in production and trade between themselves. Frodo offers 1,000 Jelly beans to Sam in exchange for 300 lce creams. Would Sam agree to this trade?
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If your tuition is $20,000 this semester, your books cost $2,000, you can only work 10 rather than 40 hours per week during the 15 weeks you are taking classes and you make $15 per hour, and your room and board is $8,000 this semester, then your opportunity cost of attending college this semester is a. $28,750. O b. $22,000. O c. $22,150. O d. $36,750.
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