ECON MACRO
5th Edition
ISBN: 9781337000529
Author: William A. McEachern
Publisher: Cengage Learning
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Question
Chapter 2, Problem 3.5P
A
To determine
Plot the
Concept Introduction:
Production productivity frontier: It is a curve which shows the maximum possible output of two goods with the given set of efficiently used inputs.
B
To determine
The cost of producing an additional car when
Concept Introduction:
Production productivity frontier: It is a curve which shows the maximum possible output of two goods with the given set of efficiently used inputs.
C
To determine
The cost of producing an additional car when
Concept Introduction:
Production productivity frontier: It is a curve which shows the maximum possible output of two goods with the given set of efficiently used inputs.
D
To determine
The cost of producing an additional washing machine when
Concept Introduction:
Production productivity frontier: It is a curve which shows the maximum possible output of two goods with the given set of efficiently used inputs.
D
To determine
What is derived about the concept of
Concept Introduction:
Production productivity frontier: It is a curve which shows the maximum possible output of two goods with the given set of efficiently used inputs.
Expert Solution & Answer
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Students have asked these similar questions
A production possibilities table for bananas and apples is shown below:
Production Alternatives
Type of Production
A
D
E
Bananas (pounds)
20
40
60
80
Apples (pounds)
100
75
50
25
a. Show these data graphically.
Instructions: Use the tool provided 'PPC' to draw a PPC curve (plot 5 points total).
125
Tools
100
PPC
75
50
25
20
40
60
80
100
Bananas (in pounds)
Apples (in pounds)
(Shape of the PPF) Suppose a production possibilitiesfrontier includes the following combinations:Cars Washing Machines0 1,000100 600200 0a. Graph the PPF, assuming that it has no curvedsegments.b. What is the cost of producing an additional car when50 cars are being produced?
A production possibilities table for bananas and apples is shown below:
Production Alternatives
Type of Production
A
B
D
E
Bananas (pounds)
20
40
60
80
Apples (pounds)
100
75
50
25
a. Show these data graphically.
Instructions: Use the tool provided 'PPC' to draw a PPC curve (plot 5 points total).
125
Tools
100
PPC
75
50
25
20
40
60
80
100
(in pounds)
Instructions: In part c, round your answers to 2 decimal places.
b. Does the economy above demonstrate the law of increasing opportunity cost?
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c. Based on this information, what is the opportunity cost of a pound of apples?
pound(s) of bananas
What is the opportunity cost of a pound of bananas?
pound(s) of apples
Apples (in pounds)
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- 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?arrow_forwardThe table shows Yucatan's production possibities, Food (pounds per month) Food (pounds per month) 200 Sunscreen (gallons per month) and 200 100 and 400 50 and 600 and 800 150- Draw the four points defined in the table. Use the four-point line tool to draw the PPF. Label it. 100 100 IH Yucatan produces 100 pounds of food per month, it must produce 400 galions of sunscreen to achieve production efficiency 50 The opportunity cost of 1 pound of food isegallons of le00 400 Sunscreen (galons per month) le00 sunscreen 200 1000 The opportunity cost of 1 gallon of sunscroen isO pounds of food. > Answer to 2 decmal places. » Draw only the objects specified in the questionarrow_forwardand Applications Q3 Caroline and Frances are roommates. They spend most of their time studying (of course), but they leave some time for their favorite activities: making pizza and brewing root beer, Caroline takes 3 hours to brew a gallon of root beer and 2 hours to make a pizza. Frances takes 7 hours to brew a gallon of root beer and 5 hours to make a pizza. Caroline's opportunity cost of making a pizza is of root beer. has an absolute advantage in making pizza, and If Caroline and Frances trade foods with each other, of root beer, and Frances's opportunity cost of making a pizza has a comparative advantage in making pizza. will trade pizza in exchange for root beer. The price of pizza can be expressed in terms of gallons of root beer. The highest price at which pizza can be traded that would make both roommates of root beer per pizza. better off is of root beer, and the lowest price that makes both roommates better off isarrow_forward
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