2 Read the following scenario and answer the questions that follow.Scenario 1The production possibilities curve indicates the combinations of any two goods or services that areattainable when the community's resources are fully and efficiently employed. The productionpossibilities curve further illustrates scarcity, choice, and opportunity cost.An economics lecturer at STADIO specialises in the production of two products, namely explainerslides and explainer videos. The production of explainer slides, according to the lecturer, is regardedas labour intensive as opposed to the production of explainer videos. The lecturer explains that theexplainer videos are highly capital intensive due to the equipment and software required to producea video.Consider the following graph, which illustrates the quantity of explainer slides and explainer videosproduced by the lecturer.50B4742D35E4.Explainer VideosThe production possibilities curve (PPC) below shows the combinations of explainer slides andexplainer videos attainable when the resources of the lecturer are fully and efficiently employed.For scenario 1, answer the following questions:Given your understanding on the production possibilities curve, complete the specifiedproduction possibilities for the lecturer in the table below.4.1.PossibilityADEFExplainer SlidesExplainer Videos504.2.Discuss how the production possibilities curve illustrates scarcity, efficiency, andinefficiency in terms of resource allocation regarding the combinations of explainerslides and explainer videos that can be produced by the lecturer. Incorporate thescenario by referring to the different points on the production possibilities in unurdiscussion.With reference to the production possibilities curve explain the concept known asopportunity cost by discussing the trade-off concerned with shift in the production frompoint C towards point E.4.3.Explainer Slides

production possibility curve is the comparison of efficiency between production of two goods or…

Discuss how the production possibilities curve illustrates scarcity, efficiency, and inefficiency in terms of resource allocation regarding the combinations of explainer slides and explainer videos that can be produced by the lecturer. Incorporate the scenario by referring to the different points on the production possibilities in vnur discussion. With reference to the production possibilities curve explain the concept known as opportunity cost by discussing the trade-off concerned with shift in the protuction from point C towards point E.

Discuss how the production possibilities curve illustrates scarcity, efficiency, and inefficiency in terms of resource allocation regarding the combinations of explainer slides and explainer videos that can be produced by the lecturer. Incorporate the scenario by referring to the different points on the production possibilities in vnur discussion. With reference to the production possibilities curve explain the concept known as opportunity cost by discussing the trade-off concerned with shift in the protuction from point C towards point E.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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There is a bar on Off‐Main Street called the Rock‐n‐Roll Bar. All the people that go to that bar like to listen to rock‐n‐roll music, and they love live bands. If the bar owner brings bands in to play music on a Saturday night, she will make a lot of money. However there are tenants in this building who get annoyed by the loud music. The benefits/costs to the owner/tenants of having zero, one, two or three bands on a Saturday night are listed in the attached table. If the tenants have the right to be free of loud music enforced through a property rule, how many bands will play in Rock‐n‐Roll Bar on a Saturday night? A. Zero B. One C. Two D. Three E. It depends on transaction costs
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There is a bar on Off‐Main Street called the Rock‐n‐Roll Bar. All the people that go to that bar like to listen to rock‐n‐roll music, and they love live bands. If the bar owner brings bands in to play music on a Saturday night, she will make a lot of money. However there are tenants in this building who get annoyed by the loud music. The benefits/costs to the owner/tenants of having zero, one, two or three bands on a Saturday night are listed below. Assume the bar owner has the right to hire as many bands as she likes. Iftransaction costs were $90, split between the bar owner and the tenants, how manybands would play? What would social welfare be? A. Three bands would play and social welfare would be ‐100.B. Two bands would play and social welfare would be 75.C. Two bands would play and social welfare would be ‐15.D. No bands would play and social welfare would be 0.E. Three bands would play and social welfare would be ‐190
There is a bar on Off‐Main Street called the Rock‐n‐Roll Bar. All the people that go to that bar like to listen to rock‐n‐roll music, and they love live bands. If the bar owner brings bands in to play music on a Saturday night, she will make a lot of money. However there are tenants in this building who get annoyed by the loud music. The benefits/costs to the owner/tenants of having zero, one, two or three bands on a Saturday night are listed below. If the tenants have the right to be free of loud music enforced through aproperty rule, how many bands will play in Rock‐n‐Roll Bar on a Saturday night? A. ZeroB. OneC. TwoD. ThreeE. It depends on transaction costs
help
E2