**Title: Understanding Production Possibilities and Opportunity Costs****Graphs Explanation:**The image contains two production possibility frontiers (PPFs) for individuals named Paul and Cliff. Each graph depicts the trade-off between producing wheat and corn.- **Paul's PPF:** - The graph shows a straight line with endpoints at 8 bushels of wheat (y-axis) and 10 bushels of corn (x-axis). - **Cliff's PPF:** - This graph has endpoints at 6 bushels of wheat (y-axis) and 4 bushels of corn (x-axis).**Key Questions:**1. **If Paul divides his time equally between corn and wheat, he will be able to produce:** a. 2 bushels of wheat and 2 bushels of corn. b. 3 bushels of wheat and 3 bushels of corn. c. 4 bushels of wheat and 5 bushels of corn. d. 4 bushels of wheat and 6 bushels of corn. 2. **Paul’s opportunity cost of 1 bushel of corn is _____ bushel(s) of wheat.****Scenario Analysis:**Assume Cliff and Paul were both producing wheat and corn, dividing their time equally between the two. Each then specializes in the product in which they have a comparative advantage, agreeing to trade 3 bushels of wheat for 3 bushels of corn.**Result of Specialization and Trade:**- Cliff is able to consume: a. 4 bushels of wheat and 3 bushels of corn, point lies on Cliff’s PPF. b. 3 bushels of wheat and 3 bushels of corn, point lies outside Cliff’s PPF. c. 3 bushels of wheat and 2 bushels of corn, point lies on Cliff’s PPF. d. 4 bushels of wheat and 3 bushels of corn, point lies outside Cliff’s PPF. By analyzing these graphs and scenarios, students can gain insights into the concepts of opportunity cost, comparative advantage, and the benefits of trade.

Ans-1. Correct option is 'option c' i.e., 4 bushels of wheat and 5 bushels of corn. Explanation If…

Answered: If Paul divides his time equally…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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COUCHES CHAIRS COUCHES O b.neither Graph (a) nor Graph (b). Oc. both Graph (a) and graph (b). O d. Graph (0) only. CHAIRS Refer to Figure 3-1. The rate of trade-off between producing chairs and producing couches is constant in O a. Graph (b) only.
FIGURE 2-4 Production possibilites curve Food Refer to Figure 2-4. If the economy chooses to shift more of its resources into clothing, what will it have to give up? Select one: O a. larger and larger amounts of food per unit of added clothing as the quantity of clothing produced increases O b. nothing, since food and clothing are NOT substitutes O c. relatively equal amounts of food per unit of added clothing as the quantity of clothing produced increases Clohing
Sh 11 Economics
1. If we assume that Coke and Pepsi are substitute products, what would happen to the supply and demand for Pepsi if Pepsi raised their price? What would happen to the supply and demand for Coke if Pepsi raised their price? (Be sure to think about what consumers would do and what effect their behavior has on demand. Then think about in the long run what the companies would do to adjust to any changes in demand) 2. In the United States, oranges are grown primarily in Florida and California. Imagine if there is a freeze in Florida that destroys 20% of the orange crop. What would happen to the market for Florida oranges? How would the California orange market change?
Since the 1970s, the percent of income spent on apparel in the U.S. has O increased O not changed O decreased
An increase in the price of wheat will lead to Select one: O a. an upward movement along the demand curve for wheat. O b. a leftward shift in the demand curve for wheat. Oc arightward shift in the supply curve for wheat. O d. an increase in the quantity of wheat consumed.
The opportunity cost of a hotdog in terms of hamburgers is O the ratio of the price of a hotdog to the price of a hamburger. O the price of a hot dog minus the price of a hamburger. O the ratio of the slope of the demand curve for hot dogs to the slope of the demand curve for hamburgers. the ratio of the slope of the supply curve for hot dogs to the slope of the supply curve for hamburgers.
Question 3 In 2018 there was a decrease in the supply of tequila in the United States. Which of the following would explain why? (Select all that apply.) O a. Drought in agave (main ingredient of tequila) farming regions. O b. Increased price of glass. O. More efficient tahonas (grinds agave to extract the juice used for tequila). O d. Distillery workers' wage increases. O e. Increase in number of distilleries. O f. Decrease in price of agave syrup (made in same ingredients).
A nomadic tribe in Lapland spends all its productive time hunting reindeer. Someof the reindeer meat is kept for consumption and the remainder is sold at a nearbytrading station in return for other goods. It is observed that when the price ofreindeer meat increases the amount the tribe is willing to supply decreases.(a) Sketch this situation in a diagram, with axes ‘reindeer meat’ and ‘all othergoods’. (Hint: locate the production position and sketch the consumptionopportunities line before and after the price change).(b) Determine if reindeer meat is an inferior good to the tribe?(Hint: consider what happens to the consumption position).(c) How does the analysis change if the tribe can hunt and trade fish as well as thereindeer? (Hint: now label the axes ‘reindeer meat’ and ‘fish’ and considerboth the production and consumption decisions
7. A shift in the supply curve of bicycles resulting from higher metal prices will lead to higher prices lower prices a shift in the demand curve larger output a. b C. d.

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If Paul divides his time equally between corn and wheat, he will be able to produce Paul Cliff Wheat Wheat 8 10 Com Corn . 2 bushels of wheat and 2 bushels of corn. o. 3 bushels of wheat and 3 bushels of corn. . 4 bushels of wheat and 5 bushels of corn. 1. 4 bushels of wheat and 6 bushels of corn.