Compute the production cost and opportunity cost

Reference no: EM1312846

Shape of the PPF

Suppose a production possibilities frontier includes the following combinations:

Cars	Washing Machines
0	1,000
100	600
200	0

1. Graph the PPF, assuming that it has no curved segments.

2. What is the cost of producing an additional car when 50 cars are being produced?

3. What is the cost of producing an additional care when 150 cars are being produced?

4. What is the cost of producing an additional washing machine when 50 cars are being produced? When 150 cars are being produced?

5. What do your answers tell you about opportunity costs?

Reference no: EM1312846

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