"Let's see how this applies to your study time. If you have three hours per night to study, you can allocate that time between studying economics and studying psychology. Perhaps each extra hour per night you devote to studying economics will raise your econ grade by 8 points, while allocating that time to studying psychology instead will boost your psych grade by only 4 points. Effectively you are the general manager of a grades-producing factory whose input is study time and whose outputs are grades in different courses. You can use the factory's resource to increasing your economics or psychology scores and you can do this in different combinations. At one extreme, you could spend all three hours studying economics, which would raise your economics grade by 24 points (and psychology by 0 points). At the other extreme, you could spend all three hours studying psychology, which would increase your psychology grade by 12 points (and economics by 0 points). In between there are many other possibilities for allocating your study time, each of which corresponds to a point on your Together, these points form a line, shown in the Figure (although in many other cases, may be a bowed-out curve). Improve your economics grade 3 hours on econ and 0 hours on psych 24 points →→ Improve econ by 24 points and psych by 0 points 20 16 12 8 4 0 4 2 hours on econ and 1 hour on psych → Improve econ by 16 points and psych by 4 points 1 hour on econ and 2 hours on psych → Improve econ by 8 points and psych by 8 points Production possibility frontier 8 O hours on econ and 3 hours on psych → Improve econ by 0 points and psych by 12 points 12 24 points 16 20 Improve your psychology grade and you'll end up producing less of each output shows this opportunity cost: Every hour It describes the most that you can produce given your current circumstances. If you waste your resources, or use them inefficiently, you won't be on the (grades) than you otherwise could. When you're on your you can't produce more of one output unless you produce less of the other. Moving along your you devote to studying psychology (which raises your psychology grade by 4 points) is one less hour you give to economics (which would have increased your economics grade by 8 points). As a result, the opportunity cost of studying one hour for psychology is _." Choose the best set of terms from the following options to fill in the blanks in the above text. Best means: your choice should have all the terms you need to fill in the blanks, and should not have any term that is not needed for any blank. O production possibilities frontier, supply curve, opportunity cost, 4 points in economics O production possibilities frontier, supply curve, 8 points in economics O production possibilities frontier, 4 points in psychology O production possibilities frontier, 8 points in economics production possibilities frontier 4 points in economics