Paul, Noel, and Sandi work in a bakery where they make pies and cakes. In one day, Paul can make 5 pies or 5 cakes or any combination of these two goods that lie on the same line containing these two production points. Noel can make 30 pies or 10 cakes or any combination of these two goods that lie on the same line containing these two production points. Sandi can make 12 pies or 6 cakes or any combination of these two goods that lie on the same line containing these two production points. Assume that the production possibility frontier (PPF) of each person is a straight line. What are the opportunity costs of producing 1 pie in terms of the number of cakes for Paul, Noel, and Sandi? a. The opportunity cost of producing 1 pie for Paul is 1 cake; for Noel is one third of a cake; for Sandi is one half of a cake. b. The opportunity cost of producing 1 pie for Paul is 1 cake; for Noel is three cakes; for Sandi is one half of a cake. c. The opportunity cost of producing 1 pie for Paul is 10 cakes; for Noel is one third of a cake; for Sandi is one fourth of a cake. d. Cannot tell from the information provided above.
Paul, Noel, and Sandi work in a bakery where they make pies and cakes. In one day, Paul can make 5 pies or 5 cakes or any combination of these two goods that lie on the same line containing these two production points. Noel can make 30 pies or 10 cakes or any combination of these two goods that lie on the same line containing these two production points. Sandi can make 12 pies or 6 cakes or any combination of these two goods that lie on the same line containing these two production points. Assume that the
What are the
| a. |
The opportunity cost of producing 1 pie for Paul is 1 cake; for Noel is one third of a cake; for Sandi is one half of a cake. |
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| b. |
The opportunity cost of producing 1 pie for Paul is 1 cake; for Noel is three cakes; for Sandi is one half of a cake. |
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| c. |
The opportunity cost of producing 1 pie for Paul is 10 cakes; for Noel is one third of a cake; for Sandi is one fourth of a cake. |
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| d. |
Cannot tell from the information provided above. |
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