The graph to the right depicts an economy, Home, which produces flowers and soybeans. Its production possibilities frontier is shown as TT. One of Home's isovalue lines is also shown as VV. Ps = $2 ... the price of a unit of soybeans Q = 5 ... the number of units of soybeans currently being produced at point X P $2... the price of a unit of flowers = Q₁ = 5... the number of units of flowers currently being produced at point X. What is the significance of Home operating at point X on the graph to the right? A. It maximizes Home's value of output. B. It minimizes Home's total cost of production. OC. It maximizes Home's profit. OD. It maximizes the utility of Home consumers. C Production of soybeans, Qs 16- 15- 14- 13- 12- 11- 10- 7- Home Production 6- ☑ 5- 4- 3- 2- 1- 0- TT ⚫JVV 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 Flower production, Qf

The graph to the right depicts an economy, Home, which produces flowers and soybeans. Its production possibilities frontier is shown as TT. One of Home's isovalue lines is also shown as VV. Ps = $2 ... the price of a unit of soybeans Q = 5 ... the number of units of soybeans currently being produced at point X P $2... the price of a unit of flowers = Q₁ = 5... the number of units of flowers currently being produced at point X. What is the significance of Home operating at point X on the graph to the right? A. It maximizes Home's value of output. B. It minimizes Home's total cost of production. OC. It maximizes Home's profit. OD. It maximizes the utility of Home consumers. C Production of soybeans, Qs 16- 15- 14- 13- 12- 11- 10- 7- Home Production 6- ☑ 5- 4- 3- 2- 1- 0- TT ⚫JVV 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 Flower production, Qf

Microeconomics: Private and Public Choice (MindTap Course List)

16th Edition

ISBN:9781305506893

Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson

Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson

Chapter3: Demand, Supply, And The Market Process

Section: Chapter Questions

Problem 14CQ

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The graph to the right depicts an economy, Home, that produces both flowers and soybeans. Flowers are the labor intensive good and soybeans are the land intensive good. Home presently exports flowers. The graph also indicates Home's optimal point of production, X. Suppose that Home has acquired more land in which it can now produce 12 units of soybeans if all land were devoted toward its production. Using the three-point curved line drawing tool, draw the new production possibilities frontier that indicates this biased growth of land in Home. Properly label this curve. Carefully follow the instructions above and only draw the required object. The growth biased toward land causes OA. export-biased growth. O B. a decrease in the relative price of flowers. OC. a rightward shift of the relative supply curve. O D. import-biased growth. 16- 15- 14- 13- 12- 11- 10- 9- 7- 6- 5- Growth of a Factor Soybean output VV TT 7 8 9 10 11 12 13 14 15 16 Flower output €
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