Use the blue line (circle symbol) to draw Japan's production possibilities frontier (PPF) on the following graph. Then use the black point (plus symbol) toindicate the consumption bundle Japan can achieve without trade if it chooses to consume 15 million cars.Cars (milions)2018161412109864210050Japan100 150 200 250Wheat (milions of bushels)300 350 400PPFWithout TradeNow suppose that the United States offers to buy 5 million cars from Japan in exchange for 150 million bushels of wheat.accept the deal the United States proposes.With TradeOn the should ph, use the grey point (star symbol) to indicate the consumption bundle Japan can achieve with trade if it continues to consume 15millionshould not 4. Problems and Applications Q4Suppose that there are 10 million workers in Japan and that each of these workers can produce either 2 cars or 20 bushels of wheat in a year.bushels of wheat, and the opportunity cost of producing a bushel of wheat in Japan isThe opportunity cost of producing a car in Japan is 2011/10 cars.Use the blue line (circle symbol) to draw Japan's pr5indicate the consumption bundle Japan can achieve 10Cars (millions)201816141210842001/105020possibilities frontier (PPF) on the following graph. Then use the black point (plus symbol) totrade if it chooses to consume 15 million cars.100 150 200 250 300 350 400Wheat (millions of bushels)PPF+Without TradeWith TradeNow suppose that the United States offers to buy 5 million cars from Japan in exchange for 150 million bushels of wheat.

Opportunity cost is the cost of producing one good in terms of another. Opportunity cost shows the…

Suppose that there are 10 million workers in Japan and that each of these workers can produce either 2 cars or 20 bushels of wheat in a year bushels of wheat, and the opportunity cost of producing a bushel of wheat in Japan is The opportunity cost of producing a car in Japan is 20 1/10 cars. 5 Use the blue line (circle symbol) to draw Japan's pr indicate the consumption bundle Japan can achieve Cars (millions) 222 20 18 16 14 12 10 8 6 4 50 1/10 100 150 200 250 Wheat (millions of bushels) 10 20 possibilities frontier (PPF) on the following graph. Then use the black point (plus symbol) to trade if it chooses to consume 15 million cars. 300 350 400 PPF + Without Trade With Trade Now suppose that the United States offers to buy 5 million cars from Japan in exchange for 150 million bushels of wheat.

Suppose that there are 10 million workers in Japan and that each of these workers can produce either 2 cars or 20 bushels of wheat in a year bushels of wheat, and the opportunity cost of producing a bushel of wheat in Japan is The opportunity cost of producing a car in Japan is 20 1/10 cars. 5 Use the blue line (circle symbol) to draw Japan's pr indicate the consumption bundle Japan can achieve Cars (millions) 222 20 18 16 14 12 10 8 6 4 50 1/10 100 150 200 250 Wheat (millions of bushels) 10 20 possibilities frontier (PPF) on the following graph. Then use the black point (plus symbol) to trade if it chooses to consume 15 million cars. 300 350 400 PPF + Without Trade With Trade Now suppose that the United States offers to buy 5 million cars from Japan in exchange for 150 million bushels of wheat.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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c. Suppose a small country produces only food and clothing. An earthquake destroys many of the clothing factories, but the ability to produce food is unaffected. Use the 3-point-curve drawing tool to draw a new production possibilities boundary on the graph on the right, labeled c, reflecting the change in the clothing factories. Properly label this line. Place end points one on horizontal and one on vertical axes. Carefully follow the instructions above, and only draw the required objects. Tonnes of Clothing Per Year PPBO Tonnes of Food Per Year
3. Country A and Country B are two countries that each produce t-shirts (T) and sneakers (S). From its available resources and technology Country A can produce 100 t-shirts and 0 sneakers or 0 tshirts and 200 sneakers or any combination of t-shirts and sneakers that sits on Country A’s linear PPF. From its available resources and technology Country B can produce 50 t-shirts and 0 sneaker or 0 t-shirt and 50 sneakers or any combination of t-shirts and sneakers that sits on Country B’s linear PPF. a. On two separate graphs draw the PPF for Country A and Country B. Measure t-shirts on the vertical axis and sneakers on the horizontal axis. b. Write an equation in slope-intercept form for the PPF for Country A. c. Write an equation in slope-intercept form for the PPF for Country B
9. Draw a PPF curve for the macroeconomy of Germany (a large producer of capital goods). Assume that Germany has an unemployment rate of 7%. (Hint: draw the dashed line assuming a full employment level of 4.5% unemployment rate and consider only consumption and capital goods in the economy.)
6. Shifts in production possibilities Suppose Argentina produces two types of goods: agricultural and capital. The following diagram shows its current production possibilities curve (PPC) for barley, an agricultural good, and airplanes, a capital good. Drag the production possibilities curve (PPC) on the graph to show the effects of a time-saving innovation in the manufacturing of airplanes. Note: Select either end of the curve on the graph to make the endpoints appear. Then drag one or both endpoints to the desired position. Points will snap into position, so if you try to move a point and it snaps back to its original position, just drag it a little farther. AIRPLANES (Thousands) 180 150 120 8 O 60 30 0 0 70 PPC 140 210 280 BARLEY (Millions of bushels) 350 420 PPC
1. Suppose there are two countries Peru and Japan that produce Food and Fuel. Peru can produce 7,523 units of Food or 17,853 units of Fuel using a labour force of 8000. Japan can produce 5,733 units of Food or 24,156 units of Fuel using a labour force of 5000. a) Which country has the comparative advantage in food? In fuel? Explain. b) Which good(s) should each country specialize in? c) Discuss the benefits of specialization for each country.
The table below shows the production possibilities for Canada and Japan. Suppose that, prior to specialization and trade, both Canada and Japan are producing combination C. Product DVD players Bushels of wheat Product DVD players Bushels of wheat DVD players 100 80 60 40 20 0 20 A Canada 40 60 A 20 0 A 40 0 Quantity of wheat per period 80 B 15 20 a) Draw the production possibilities curve for Canada in the graph A, and indicate its present output position. Draw the production possibilities curve for Japan in graph B, and indicate its present output position. Plot only the endpoints of each curve in the graphing areas using the appropriate tool. Plot the output combination in each graph using the Point tool. 100 B 30 7.5 CANADA'S PRODUCTION POSSIBILITIES C 10 40 JAPAN'S PRODUCTION POSSIBILITIES с 20 15 Tools PP Curve combination D 5 Trading Possi New combina 60 D 10 22.5 E 0 80 E 0 30
Meanwhile, in the country of Portugal, wool and wine can also be produced according to a linear PPF. However, when all resources are devoted to production of wine, Portugal can produce 100 barrels, but when all resources are devoted to wool production, portugal can produce 50 bushels. What are the opportunity costs in Portugal of producing a barrel of wine?
Suppose Martha and Julia both work at a bakery making bread and muffins. In an hour, Martha can either make 10 loaves of bread or 40 muffins, while Julia can either make 12 loaves of bread or 60 muffins. Both Martha and Julia work 8 hours a day. Draw julias daily PPC What is the opportunity cost to each of making one loaf of bread? Martha's opportunity cost of making a loaf of bread muffins Julia's opportunity cost of making a loaf of bread muffins What is the opportunity cost to each of making one muffin? Martha's opportunity cost of making a muffin loaves of bread Julia's opportunity cost of making a muffin loaves of bread Who has the comparative advantage in making bread? Julia Martha Neither Who has the absolute advantage in making bread? Neither Martha Julia Suppose you are the owner of the bakery. If Julia and Martha are currently both spending all of their time making muffins, then which of them should you ask to start making bread?…
Suppose that the US economy produces agricultural products (A) and manufactured products (M). Explain and graphically illustrate the impact of each of the following events on the economy’s production possibilities curve (draw a new PPF for each, placing M on the vertical axis). a. Scientists develop a new fertilizer that will increase the productivity of land on which agricultural products are grown. b. The price of manufactured goods increases. c. Russian attacks on Ukraine devastate the Ukrainian wheat crop, increasing their demand for American wheat. d. The government increases taxes on manufactured goods.
Figure 2 shows the PPF for an economy that produces Butter and Guns. Suppose the economy is currently producing 30,000 units of butter and 3,600 guns. What is the economy's opportunity cost of producing 10,000 additional units of butter? A) 600 Guns B) 1,000 Guns C) 1,400 Guns D) 1,700 Guns
Question 2. Imagine the country of Zed, which has the following production possibilities curve: Tanks Noodles 0 51 100 45 200 38 300 30 400 21 500 11 600 0 a) What is the opportunity cost between tanks and noodles? Is it constant?Graph the ppc. b) True, false, uncertain, and explain: “This economy should produce 30 noodles and 300 tanks because that is the most even distribution of resources between the two goods.”
Suppose there exist two imaginary countries, Everglades and Yosemite. Their labor forces are each capable of supplying four million hours per day that can be used to produce chinos, pistachios, or some combination of the two. The following table shows the amount of chinos or pistachios that can be produced by one hour of labor. Country Everglades Yosemite Chinos Pistachios (Pairs per hour of labor) (Pounds per hour of labor) 4 6 16 12 Suppose that initially Yosemite uses 1 million hours of labor per day to produce chinos and 3 million hours per day to produce pistachios, while Everglades uses 3 million hours of labor per day to produce chinos and 1 million-hours per day to produce pistachios. As a result, Everglades produces 12 million pairs of chinos and 16 million pounds of pistachios, and Yosemite produces 6 million pairs of chinos and 36 million pounds of pistachios. Assume there are no other countries willing to engage in trade, so, in the absence of trade between these two…