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Suppose that the community of Markstown produces two goods: Michelob light beer (MLB) and bacon/lettuce/tomato sandwiches (BLTs). Assuming increasing opportunity costs, draw a production possibilities curve (PPC) for Markstown (be sure to label both axes correctly).

Suppose that the community of Markstown produces two goods: Michelob light beer (MLB) and bacon/lettuce/tomato sandwiches (BLTs). Assuming increasing opportunity costs, draw a production possibilities curve (PPC) for Markstown (be sure to label both axes correctly).

ENGR.ECONOMIC ANALYSIS
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 that the community of Markstown produces two goods: Michelob light beer
(MLB) and bacon/lettuce/tomato sandwiches (BLTs). Assuming increasing
opportunity costs, draw a production possibilities curve (PPC) for Markstown 

### Economics of Markstown: Production Possibilities and Opportunity Costs #### Question 1 **Scenario:** Suppose that the community of Markstown produces two goods: Michelob light beer (MLB) and bacon/lettuce/tomato sandwiches (BLTs). Assuming increasing opportunity costs, draw a production possibilities curve (PPC) for Markstown (be sure to label both axes correctly). **Assignment:** - Draw the PPC on a graph: - Label the x-axis as "MLB". - Label the y-axis as "BLTs". #### Question 2 **Assignment:** On your graph of the PPC from Question 1, find and label the following: a. **An inefficient point** (label it X) - This point should be inside the PPC curve. b. **An efficient point** (label this one Y) - This point should be on the PPC curve. c. **An unattainable point** (label it Z) - This point should be outside the PPC curve. #### Question 3 Due to an increase in immigration across its borders, Markstown has experienced an increase in the size of its labor force. On your graph above, show how this change affects the PPC of Markstown. **Assignment:** - Illustrate an outward shift of the PPC, indicating that more of both goods can be produced due to the larger labor force. **Graph Explanation:** The original PPC will shift outward, demonstrating an increase in production capacity for both Michelob light beer (MLB) and BLTs, as the additional labor allows for more of each to be produced without sacrificing quantity of the other. #### Question 4 In your own words, what is meant by the term “opportunity costs?” Give at least three (3) examples of the opportunity costs associated with you being stuck in this class with me this summer! **Assignment:** - **Opportunity Costs Definition:** Opportunity costs refer to the value of the next best alternative that you give up when you make a choice. - **Examples:** 1. **Personal Time:** - Not being able to spend time with friends and family. 2. **Relaxation:** - Missing out on leisure activities such as going to the beach or watching TV at home. 3. **Other Studies or Projects:** - Not being able to dedicate time to other coursework,
Transcribed Image Text:### Economics of Markstown: Production Possibilities and Opportunity Costs #### Question 1 **Scenario:** Suppose that the community of Markstown produces two goods: Michelob light beer (MLB) and bacon/lettuce/tomato sandwiches (BLTs). Assuming increasing opportunity costs, draw a production possibilities curve (PPC) for Markstown (be sure to label both axes correctly). **Assignment:** - Draw the PPC on a graph: - Label the x-axis as "MLB". - Label the y-axis as "BLTs". #### Question 2 **Assignment:** On your graph of the PPC from Question 1, find and label the following: a. **An inefficient point** (label it X) - This point should be inside the PPC curve. b. **An efficient point** (label this one Y) - This point should be on the PPC curve. c. **An unattainable point** (label it Z) - This point should be outside the PPC curve. #### Question 3 Due to an increase in immigration across its borders, Markstown has experienced an increase in the size of its labor force. On your graph above, show how this change affects the PPC of Markstown. **Assignment:** - Illustrate an outward shift of the PPC, indicating that more of both goods can be produced due to the larger labor force. **Graph Explanation:** The original PPC will shift outward, demonstrating an increase in production capacity for both Michelob light beer (MLB) and BLTs, as the additional labor allows for more of each to be produced without sacrificing quantity of the other. #### Question 4 In your own words, what is meant by the term “opportunity costs?” Give at least three (3) examples of the opportunity costs associated with you being stuck in this class with me this summer! **Assignment:** - **Opportunity Costs Definition:** Opportunity costs refer to the value of the next best alternative that you give up when you make a choice. - **Examples:** 1. **Personal Time:** - Not being able to spend time with friends and family. 2. **Relaxation:** - Missing out on leisure activities such as going to the beach or watching TV at home. 3. **Other Studies or Projects:** - Not being able to dedicate time to other coursework,
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