1. Specialization and production possibilitiesSuppose Poland produces only tablets and smartphones. The resources that are used in the production of these two goods are not specialized-that is,the same set of resources is equally useful in producing both smartphones and tablets.The shape of Poland's production possibilities frontier (PPF) should reflect the fact that as Poland produces more smartphones and fewer tablets, theopportunity cost of producing each additional smartphoneThe following graphs show two possible PPFS for Poland's economy: a straight line PPF (PPF1) and a bowed-out PPF (PPF2).TABLETSPPF₁Graph 1SMARTPHONES?TABLETSPPF2Graph 2SMARTPHONES(?) The shape of Poland's production possibilities frontier (PPF) should reflect the fact that as Poland produces more smartphones and fewer tablets, theopportunity cost of producing each additional smartphoneThe following graphs show two possible PPFS for Poland's economy: a straight-line PPF (PPF1) and a bowed-out PPF (PPF2).TABLETSPPF₁Graph 1SMARTPHONES?TABLETSPPF₂Graph 2SMARTPHONES(?)Based on the previous description, the trade-off Poland faces between producing smartphones and tablets is best represented by

Production Possibility Frontier (PPF) illustrates the combination of two goods that a nation can…

Suppose Poland produces only tablets and smartphones. The resources that are used in the production of these two goods are not specialized-that is, the same set of resources is equally useful in producing both smartphones and tablets. The shape of Poland's production possibilities frontier (PPF) should reflect the fact that as Poland produces more smartphones and fewer tablets, the opportunity cost of producing each additional smartphone The following graphs show two possible PPFS for Poland's economy: a straightyline PPF (PPF1) and a bowed-out PPF (PPF2).

Suppose Poland produces only tablets and smartphones. The resources that are used in the production of these two goods are not specialized-that is, the same set of resources is equally useful in producing both smartphones and tablets. The shape of Poland's production possibilities frontier (PPF) should reflect the fact that as Poland produces more smartphones and fewer tablets, the opportunity cost of producing each additional smartphone The following graphs show two possible PPFS for Poland's economy: a straightyline PPF (PPF1) and a bowed-out PPF (PPF2).

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Suppose the economy initially produces 15,000 gallons of drinking water and 450,000 tons of steel, which is represented by point A. The opportunity cost of producing an additional 5,000 gallons of drinking water (that is, moving production to point B) is (72,000, 135,000, 90,000, 54,000, 108,000) tons of steelSuppose, instead, that the economy currently produces 378,000 tons of steel and 20,000 gallons of drinking water, which is represented by point B. Now the opportunity cost of producing an additional 5,000 gallons of drinking water (that is, moving to point C) is (72,000, 135,000, 90,000, 54,000, 108,000) ons of steel.Comparing your answers in the two previous paragraphs, you can see that the opportunity cost of 5,000 additional gallons of drinking water at point B is (Less, Equal, Or Greater Than) the opportunity cost of 5,000 additional gallons of drinking water at point A. This reflects the (Notion that Countries can gain from trade, Law of Increasing Opportunity Costs, Fact…
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The slope of the production possibilities frontier is called
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