Principles of Economics (12th Edition)
12th Edition
ISBN: 9780134078779
Author: Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher: PEARSON
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Chapter 2, Problem 1.13P
To determine
The
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Explain why the slope of the production possibilities curve becomes steeper as we move along the horizontal axis.
A country, Frankland, produces only two products, cars and trucks.
Currently, Frankland is producing on the curve, producing an even amount of cars
and trucks. Define what a production possibilities curve is and is used for, and
explain what happens when a new technology is adopted by the country of
Frankland and the nation is able to increase production because of the increased
productivity.
You must use complete sentence to answer this question.
What do you mean by the
production possibilities of an
economy
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Principles of Economics (12th Edition)
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- Consider the following production possibilities table that shows different combinations of two goods that can be produced with given resources: Shirts Corn A 0 20 B 10 15 C 20 10 D 30 5 E 40 0 Based on the table, which is true? Group of answer choices Opportunity cost is increasing Opportunity cost is constantarrow_forwardUsing your own words, describe the law of increasing opportunity costs. Be sure to explain why this phenomenon occurs and how it helps to contribute to the shape of the production possibilities frontier.arrow_forwardThe chart is already done. Need help with the questions below.arrow_forward
- If Yucatan produces 200 pounds of food per month, it must produce 5050 gallons of sunscreen to achieve production efficiency. Part 3 The opportunity cost of 1 pound of food is enter your response here gallons of sunscreen. The opportunity cost of 1 gallon of sunscreen is enter your response here pounds of food.arrow_forwardQ3. Home has 1,200 units of labor available. It can produce two goods, apples and bananas. The unit labor requirement in apple production is 3, while in banana production it is 2. a. Draw Home's production possibility frontier. Label the curve PPF. (Clearly show the maximum amount of the two goods that can be produced on your graph) b. What is the opportunity cost of apples in terms of bananas? (Enter your response rounded to one decimal place.) c. In the absence of trade, what would the price of apples in terms of bananas be? There is now also another country, Foreign, with a labor force (L) of 800. Foreign's unit labor requirement in apple production is 5, while in banana production it is 1. d. Derive the equation for Foreign's production possibility frontier. e. Graph Foreign’s production possibility frontier.arrow_forwardHelp pleasearrow_forward
- Help! The question is to Explain how the following situation would affect a nation's production possibilities curve. A category 5 hurricane destroys over 40% of the nation's productivity. The two questions are What happens to PPF and an explanation. The options for both are in the drop down.arrow_forwardExplain how each of the following situations would affect a nation’s production possibilities curve (i) The nation passes a law requiring all employers to give the employees 16 weeks paid vacation each year. Prior to these law employers were not legally required to give employees any paid vacation time What happens to PPF Explanationarrow_forwardWhat is the opportunity cost of obtaining more of one good, as it relates to the production possibilities frontier? the amount of the other good that must be given up the market price of the additional amount produced the amount of resources that must be devoted to its production the number of dollars that must be spent to produce itarrow_forward
- Shifts in production possibilities Suppose South Africa produces two types of goods: agricultural and capital. The following diagram shows its current production possibilities frontier for barley, an agricultural good, and locomotives, a capital good. Drag the production possibilities frontier (PPF) on the graph to show the effects of a breakout of avian flu that sickens millions of workers. 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.arrow_forwardFIGURE 2-10 Apples (bushels) Refer to Figure 2-10. What movement along the production possibilities curve best illustrates the notion "To get more apples, we have to give up wheat"? a movement from Point A to Point E a movement from Point E to Point C a movement from Point A to Point D a movement from Point B to Point E Wheat (bushels)arrow_forwardSuppose that a nation currently is producing combination D in the table below and on the graph of the production possibilities curve to the right. What is the opportunity cost of producing 5.0 million more smartphones and moving to production combination C? Combination A B DCDEFG Smartphones (millions per year) 50.0 48.0 45.0 40.0 33.0 22.5 0.0 Tablets (millions per year) 0 10 20 30 40 50 60 The opportunity cost of producing 5.0 million more smartphones and moving from production combination D to production combination C is million tablet devices per year. (Enter your response as a whole number) 500 호 Smartphones (millions per year) 30- 20- 10- A 0 B C F 10 20 30 40 50 60 Tablet Devices (millions per year)arrow_forward
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