The figure shows the production possibilities frontier for a country. If the economy is operating at point B, then the opportunity cost of another million gallons of milk is Ice cream (millions of gallons per year) O A. 1 gallon of ice cream for a gallon of milk. O B. 4 gallons of ice cream for a gallon of milk. OC. zero because after producing another million gallons of milk then zero gallons of ice 4 cream are produced. O D. 3 gallons of ice cream for a gallon of milk. O E. 1/3 of a gallon of ice cream for a gallon of milk. 4. 5 Milk (millions of gallons per year)

The figure shows the production possibilities frontier for a country. If the economy is operating at point B, then the opportunity cost of another million gallons of milk is Ice cream (millions of gallons per year) O A. 1 gallon of ice cream for a gallon of milk. O B. 4 gallons of ice cream for a gallon of milk. OC. zero because after producing another million gallons of milk then zero gallons of ice 4 cream are produced. O D. 3 gallons of ice cream for a gallon of milk. O E. 1/3 of a gallon of ice cream for a gallon of milk. 4. 5 Milk (millions of gallons per year)

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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The production possibilities are listed below: Coconuts Pineapples 8. 2. 4 2 8. Which of the following best describes the PPF for the information above? Select one: O a. The opportunity cost of producing an additional pineapple decreases as the amount of coconuts produced decreases O b. The opportunity cost of producing an additional pineapple is the same at every point O c. The opportunity cost of producing an additional pineapple is zero at every point O d. The opportunity cost of producing an additional pineapple increases as the amount of coconuts produced increases 6. 4.
Wine (thousands of bottles per year) The figure shows the production possibility frontier for a country. Suppose the country is producing at point E. What would be the opportunity cost to increase the production of wine to 9 thousand bottles? B 15 12 O A. 12 tons of rice B. 3 tons of rice D 9 O C. 15 thousand bottles of wine 6. D. Nothing, it is a free lunch 3 E. 9 thousand bottles of wine 12 15 Rice (tons per year) 3 6
Refer to the information provided in Table 33.2 below to answer the question(s) that follow. Table 33.2 China Thail and Tractors Tractors Motorcycles Motorcycles 300 225 300 250 10 200 10 150 15 150 15 75 20 100 20 25 50 30 Refer to Table 33.2. In Thailand, the opportunity cost of Select one: O A. a motorcycle is 1/15 of a tractor. O B. a motorcycle is 15 tractors. O C. a tractor is 20 motorcycles. O D. a motorcycle is 1/30 of a tractor.
It takes Andy 45 minutes to complete a load of laundry and 15 minutes to wrap a present. It takes Bob 60 minutes to complete a load of laundry and 30 minutes to wrap a present. Which of the following statements is true? Select one : O A. Bob's opportunity cost of doing a load of laundry is wrapping 3 presents. O B. Bob has a comparative advantage in doing laundry. O C. Bob has a comparative advantage in wrapping a present. O D. Andy's opportunity cost of wrapping a present is doing 3 loads of laundry. O E. Bob has an absolute advantage in doing laundry.
2. Suppose that Happy Land produces only two goods-food and suntan oil. Its production possibilities are: Food (pounds per month) 300 200 100 0 Active Land also produces only food and suntan oil, and its production possibilities are: Food (pounds per month) 150 100 50 0 Draw the two PPFs Suntan oil (gallons per month) 0 50 100 150 Suntan oil (gallons per month) 0 100 2000 300 a. What are the opportunity costs of food and suntan oil in Happy Land? b. Why are the opportunity costs the same at each output level? c. What are the opportunity costs of food and suntan oil in Active Land? d. If each nation specialized where they have a comparative advantage; and then traded, find the acceptable ranges for trade. 1 pound of food would have to trade between which values of suntan oil? 1 pound of suntan oil would have to trade between which values of food? e. If each nation produces where they have a comparative advantage, and the terms of trade are 50 pounds of food for 75 gallons of suntan oil,…
In the production possibilities frontier depicted in the figure above, what is the opportunity cost of increasing the production of bananas from two million pounds to three million pounds? Use a production possibilities frontier to analyze opportunity costs and trade-offs. Hats (millions per year) 5 4 3 2 1 0 1 2 3 4 5 6 Bananas (millions of pounds per year) O 1/2 million hats 1 million hats O 2 million hats O 3 million hats
Refer to the production possibility frontiers for two friends Frodo and Sam who can both produce Ice creams and Jelly beans. Frodo's maximum production of Ice creams is 500 with no Jelly beans, or 2,000 Jelly beans with no Ice creams. Sam's maximum production of Ice creams is 600 with no Jelly beans, or 1,200 Jelly beans with no Ice creams. ICE CREAMS ICE CREAMS 600 500 1200 JELLY BEANS 2000 JELLY BEANS Frodo' PPF Sam's PPF Answer briefly these TWO questions in the box space provided below. Part A: Assuming efficient production without trade, derive the maximum amount of Jelly beans that can be produced by Sam along with 300 Ice creams. Describe your steps in detail. Part B: Assume that Frodo and Sam agree to specialize in production and trade between themselves. Frodo offers 1,000 Jelly beans to Sam in exchange for 300 lce creams. Would Sam agree to this trade?
Suppose that United States is currently producing two goods: tanks and cars using its current resources. As the country is preparing for a war, it intends to produce more tanks and to do so, it starts coverting its car factories into tank factories. Which of the following is true? O The production possibilities curve will show the increasing opportunity costs as more tank is produced. The production possibilities curve for cars and tanks will shift outward. O The production possibilities curve will show decreased opprotunity costs as more tank is produced. O The production possibilities curve will shift inward.
In economics, normative statements are about Select one: O a. the way things are. O b. the way things ought to be. Oc. marginal benefits, not marginal costs. O d. marginal costs, not marginal benefits. The production possibilities frontier bows outward because Select one: O a. opportunity costs are decreasing as the production of a good increases. O b. resources are of uniform quality. Oc. opportunity costs are increasing as the production of a good increases. O d. opportunity costs are fixed as the production of a good increases.
Opportunity cost can be measured as the: Select one: O a. Increase in the quantity produced of one good divided by the decrease in the quantity produced of another good as we move along the production possibilities frontier. b. Decrease in the quantity produced of one good divided by the increase in the quantity produced of another good as we move along the production possibilities frontier. c. Increase in the quantity produced of one good as we move along the production possibilities frontier. d. Decrease in the quantity produced of one good as we move along the production possibilities frontier.
Time le If in a previously fully employed economy, some workers were to become unemployed, how would you show this change on the production possibility frontier? Select one: O a. The PPF would shift outward. O b. The PPF would shift inward. O c. The PPF would pivot inwards O d. The PPF would pivot outwards O e. The point representing output on the PPF would shift inside the line. Next
If your tuition is $20,000 this semester, your books cost $2,000, you can only work 10 rather than 40 hours per week during the 15 weeks you are taking classes and you make $15 per hour, and your room and board is $8,000 this semester, then your opportunity cost of attending college this semester is a. $28,750. O b. $22,000. O c. $22,150. O d. $36,750.