Foundations of Economics (8th Edition)
8th Edition
ISBN: 9780134486819
Author: Robin Bade, Michael Parkin
Publisher: PEARSON
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Question
Chapter 3, Problem 2SPPA
To determine
Attainable and efficient level of output at 50 units of entertainment and 50 units of good food.
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question 2
Home has 1200 units of labor available. There can produce two goods which watermelon and kiwi. The unit labor requirement in watermelon production is 3, while in kiwi production it is 2.
a) When all the labor only produce watermelon, how many units of watermelon can be produce?
b) When all the labor only produce kiwi, how many units of kiwi can be produce?
c) What is the opportunity cost of watermelon in terms of kiwi?
d) In the absence of trade, what would be the price of watermelon in terms of kiwi? Why?
Tom and Abby produce rackets and balls. The tables
show their production possibilities.
Tom allocates all his resources and produces 2 rackets
and 16 balls an hour. Abby allocates all her resources
and produces 2 rackets and 4 balls an hour.
Tom and Abby decide to specialize and trade.
specializes in rackets and produces
specializes in balls and produces
A. Tom; 2 rackets; Abby; 32 balls
B. Tom; 4 rackets; Abby; 8 balls
C. Abby; 4 rackets; Tom; 32 balls
D. Abby; 2 rackets; Tom; 8 balls
E. Tom; 4 rackets; Tom; 32 balls
The number of balls produced
by
If Tom and Abby specialize and trade 1 racket for 8
balls.
gets rackets from
for less than it
costs
gets balls
from
to produce
them.
to produce them, and
for less than it costs
Tom's Production Possibilities
Rackets
(per hour)
0
1
2
3
4
Abby's Production Possibilities
Rackets
(per hour)
0123
and
and
and
and
and
4
and
and
and
and
and
Balls
(per hour)
32
24
16
8
0
Balls
(per hour)
8
006 NO
4
2
0
Use the following table to answer the question below.
Jake's Production Possibilities
Schedule
Jane's Production Possibilities Schedule
Pounds of Green
Pounds of Corn
Pounds of Green
Pounds of Corn
Beans
Beans
160
80
10
120
20
60
40
20
80
40
30
40
60
20
40
80
Jake should specialize in the production of which good?
neither
both
corn
O green beans
Chapter 3 Solutions
Foundations of Economics (8th Edition)
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- In the attached figure, if 2 million computers are produced per year, then:a. The marginal cost of one computer exceeds the marginal benefit of one computer, so more computers must be produced.b. The marginal cost of a computer exceeds the marginal benefit of a computer, so fewer computers must be produced.c. The marginal benefit of a computer exceeds the marginal cost of a computer, so more computers must be produced.d. The marginal benefit of a computer exceeds the marginal benefit of a computer, so fewer computers must be produced.FOR EACH ALTERNATIVE, PLEASE EXPLAIN WHY IS TRUE, FALSE OR UNCERTAIN.arrow_forward-A) Describe production and the factors that go into producing various goods and services. -B) Describe the opportunity cost an economy incurs to increase the production of one product. Use a production possibilities frontierarrow_forwardBarbara and Antoni each work 8 hours a day producing lemonade and pizza. In eight hours, Antoni can produce 400 pints of lemonade or 200 pizzas. In the same amount of time, Barbara can produce 450 pints of lemonade or 300 pizzas. Currently, Antoni decides to produce 200 pints of lemonade and 100 pizzas, and Barbara decides to produce 180 units of each good. Draw the production possibilities frontiers for Barbara and Antoni, with pizza on the x-axis. Include current production points. In your own words, explain absolute advantage. Who has absolute advantage in lemonade production? In pizza production? In your own words, explain comparative advantage. Define opportunity cost and provide an example of an opportunity cost you face in your own life. Find Barbara's and Antoni's opportunity cost of producing pizza in terms of lemonade. Who has a comparative advantage? , Find Barbara's and Antoni's opportunity cost of producing lemonade in terms of pizza. Who has a comparative advantage? For…arrow_forward
- 5. China is able to produce turnips and potatoes in combinations represented by the following table. (Each number represents 1,000s of bushes.) Potatoes Production Turnips point a. B C D E b. C. points. 100 and 0 90 and 10 and 20 and 30 and 40 70 40 0 Plot the data on a production possibilities graph, labeling Can China produce a combination of 30 turnips and 24 potatoes? Draw this production point on the graph (label it F) and verbally explain. Demonstrate that China experiences increasing opportunity costs by calculating the opportunity cost of producing another potato at each production point. Explain.arrow_forwardHello, I would like help in this graph. Thanksarrow_forwardHi there! I have been struggling with number 7 and cannot find a solution to it, please help me out and explain. Thank you!arrow_forward
- The following is a table that shows the production possibilities for Good X and Good Y. Type of Production Possibilities Goods A B. D. E X 2 4 6. 8. Y 30 27 21 12 a. Show these data graphically on a piece of graph paper. b. What is the cost of producing 2 units of good X? c. What is the cost of producing 6 units of good X? d. What is the cost of increasing the production of good X from 4 to 8 units? e. What is the cost of moving from combination D to A? f. Label a point F inside the PPC. What is point F imply? g. Label a point G outside the PPC. What is point G imply? h. Label a point H on the PPC. What does point H imply? i. What does it mean when the combination moves from B to E along the same PPC? j. What is the this of PPC. Explain. 45arrow_forwardTable 1 Production choices for Billie's Bedroom Shop Choice A B C D E Quantity of Pillows Produced 36 27 18 9 0 Quantity of Blankets Produced 0 7 14 21 28 Refer to Table 1. Assume Billie's Bedroom Shop only produces pillows and blankets. A combination of 5 pillows and 21 blankets would appear along Billie's production possibilities frontier. inside Billie's production possibilities frontier. outside Billie's production possibilities frontier. at the vertical intercept of Billie's production possibilities frontier.arrow_forwardQuestion 17 A graph that shows the maximum attainable combinations of two goods when society efficiently uses its productive resources is called a supply curve. opportunity cost. a production possibilities frontier (PPF). O absolute advantage. a consumer demand curve.arrow_forward
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