Opportunity cost of baking one loaf of bread

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Suppose Helen works at a bakery where she bakes bread and cakes. Each hour she devotes to baking bread yields 4 loaves and each hour she devotes to baking cakes yields 8 cakes. a. What is Helen’s opportunity cost of baking one loaf of bread? Baking one cake? b. If Helen works a total of 8 hours per day, what is the maximum number of bread loaves she could bake? What is the maximum number of cakes she could bake? c. Using this information, graph Helen’s production possibilities frontier. d. Suppose that a dough kneader is introduced to the bakery that enables Helen to bake 8 loaves per hour rather than only 4. On the graph from part c, show how this development shifts her production possibilities frontier.

Reference no: EM131170957

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