Answered: 1. Define both of the following…

1. Define both of the following terminology, and then discuss the economic relationship between the two: Economics, Opportunity Cost

Essentials of Economics (MindTap Course List)

8th Edition

ISBN:9781337091992

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter1: Ten Principles Of Economics

Section: Chapter Questions

Problem 2QR

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5. Answer the questions using the following information. Aaron & Oscar decide to go into business together making iPads and Selfie Sticks. Using the information, answer the questions below. IPads hour per 20 Selfie Sticks per hour 9:41 Aaron 25 Oscar 10 25 a) Who has absolute advantage in making iPads? b) Who has absolute advantage in making Selfie Sticks? c) What is the opportunity cost of making one iPad for Aaron? (SHOW WORK)? d) What is the opportunity cost of making one Selfie Stick for Aaron? e) What is the opportunity cost of making one iPad for Oscar (SHOW WORK)? f) What is the opportunity cost of making one Selfie Stick for Oscar? g) Create a comparative advantage chart for Aaron and Oscar using the opportunity cost figures you found in parts c h) Who has comparative advantage in making iPads? Who has comparative advantage in making Selfie Sticks? How do you know this? Circle the items in which each individual has comparative advantage in the chart created from part g). f…
8. Shifts in production possibilities Suppose the United States produces two types of goods: agricultural and capital. The following diagram shows its current production possibilities frontier for alfalfa, an agricultural good, and industrial copiers, 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. 540 450 PPF 380 270 180 90 PPF 100 200 300 400 500 600 ALFALFA (Millions of bushels) INDUSTRIAL COPIERS (Thousands)
4. Shifts in production possibilities Suppose the United States produces two types of goods: agricultural and capital. The following diagram shows its current production possibilities frontier for wheat, an agricultural good, and cars, a capital good. Drag the production possibilities frontier (PPF) on the graph to show the effects of a time-saving innovation in the manufacturing of cars. 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. 480 PPF 400 320 240 160 80 PPF 0. 90 180 270 360 450 540 WHEAT (Millions of bushels) CARS (Thousands)
4. Shifts in production possibilities Suppose the United Kingdom produces two types of goods: agricultural and capital. The following diagram shows its current production possibilities frontier for barley, an agricultural good, and cars, a capital good. Drag the production possibilities frontier (PPF) on the graph to show the effects of an immigration law that results in fewer workers entering the country. 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. ? CARS (Thousands) 300 250 200 150 100 50 0 0 80 PPF 160 240 320 BARLEY (Millions of bushels) 400 480 6 PPF
5. Answer the questions using the following information. Aaron & Oscar decide to go into business together making iPads and Selfie Sticks. Using the information, answer the questions below. IPads hour Selfie Sticks hour per 25 per 9:41 Aaron 20 Oscar 10 25 a) Who has absolute advantage in making iPads? b) Who has absolute advantage in making Selfie Sticks? c) What is the opportunity cost of making one iPad for Aaron? (SHOW WORK, or you get NO CREDIT!)? d) What is the opportunity cost of making one Selfie Stick for Aaron? e) What is the opportunity cost of making one iPad for Oscar (SHOW WORK, or you get NO CREDIT!)? f) What is the opportunity cost of making one Selfie Stick for Oscar? g) Create a comparative advantage chart for Aaron and Oscar using the opportunity cost figures you found in parts c – f (create a chart like the one from your notes). h) Who has comparative advantage in making iPads? Who has comparative advantage in making Selfie Sticks? How do you know this? Circle the…
1. Ramon and Sammy are working on a group homework assignment. The homework consists of a set of essay questions and a set of questions on graphing models. Ramon can finish an essay question in about 15 minutes and a graphing question in about 30 minutes. Sammy can finish an essay question in about 20 minutes and a graphing question in about 35 minutes. Assume that Ramon and Sammy produce the same quality answers. Calculate Ramon and Sammy's opportunity cost of each task. Please round each answer to the nearest tenth. a. Ramon’s opportunity cost of completing an essay question:____ graphing questions b. Ramon’s opportunity cost of completing a graphing question:_____essay questions c. Sammy’s opportunity cost of completing an essay question:___ graphing questions d. Sammy’s opportunity cost of completing a graphing question:___essay questions 2. If the two want to specialize in working on their homework, who should do the essay questions and who should do the…
6. Efficiency in the production possibilities model Suppose Italy produces only two goods: potatoes and cars. The following graph shows Italy's current production possibilities frontier, along with six output combinations represented by black points (plus symbols) labeled A to F. A B с D E CARS (In millions) F 100 8 60 9 8 0 PPF <+ U 0 Complete the following table by indicating whether each point represents output combinations that are inefficient, efficient, feasible, or infeasible. Check all that apply. Point Inefficient Efficient Feasible U U L 0 xc U E 40 60 POTATOES (In millions) xo 00 000 100 Infeasible 000 ? 000 C
1. Assume you are on an iceland, where you can produce different combinations of coconuts and fish that can be harvested in a given week. The table below shows these combinations. Notice that you can produce either all crabs, all pineapples, or a mix of the two. Coconuts Fish 25 3 15 4 12 5 a) Draw PPF using the information from this table; b) Calculate opportunity cost of coconuts if you decide to increase their harvest from 3 to 5; c) Calculate the slope of the PPF if you increase their harvest from 3 to 5; d) Will you harvest 5 coconuts and 12 fish on any day of the week? Why? e) Will you harvest 5 coconuts and 4 fish on any day of the week? Why?
6. Study Questions and Problems #6 The following table shows a set of hypothetical production possibilities for a nation producing automobiles and beef. Combination Automobiles Beef (Thousands) (Thousands of tons) A 0 10 B 2 9 C 4 7 D 6 4 E 8 0 On the following graph, use the blue points (circle symbol) to plot the production possibilities curve for the nation using the data in the preceding table. Line segments will automatically connect the points. PPFFG012345678910109876543210Beef (Thousands of tons)Automobiles (Thousands) The opportunity cost of the first 2,000 automobiles produced is tons of beef. Between which points is the opportunity cost per thousand automobiles highest? A and B B and C C and D D and E The opportunity cost per thousand tons of beef is the highest between points Using your answers in the preceding parts, you can see that the opportunity cost of 1,000…