various intermediate quantities, Microeconomics

Assignment Help:
An economy can produce a maximum of either 28 million tons of wheat or 7,000 automobiles,
or various intermediate quantities, as depicted in the table below:

Wheat (millions of tons)
A28 ,B 7,C25,D 22,E 18,F 13,G 7,H 0
Automobiles (thousands of units)
A0,B1,C 2,D 3,E 4,F 5,G 6,H 7
a. Plot the data from the table on a graph, with wheat on the vertical axis and
automobiles on the horizontal axis.
b. Can this economy simultaneously produce 3,000 automobiles and 15 million tons of
wheat? Explain. Where would this point lie relative to the PPF?
c. Can this economy simultaneously produce 2,000 automobiles and 27 million tons of
wheat? Explain. Where would this point lie relative to the PPF?
d. Add a new row to the table listing the opportunity cost of producing the 1st through
the 7th automobiles. In what units is this opportunity cost measured?
e. What is the relationship between the opportunity costs you just calculated and the
slopes of the PPF graph?
f. Now consider if instead the economy decided to produce additional units of wheat and
fewer automobiles. In particular, consider if the economy moved from D to C. What is
the relationship between the opportunity cost of this move and the slope of the graph
connecting points C and D?
g. Can you explain why the opportunity cost of moving from point C to D is not the same
as the opportunity cost of moving from B to C? In particular, why is the opportunity
cost of moving from C to D higher than the opportunity cost of moving from B to C?
h. An alternative shape used to draw PPFs is simply a straight line. What underlying
assumption is reflected in a straightline PPF?

Related Discussions:- various intermediate quantities

Financial relationship with the imf, Financial relationship with the IMF: ...

Financial relationship with the IMF: IMF provides temporary assistance to member countries to tide over BOP deficits. When a country requires foreign exchange, its tenders its

Educational financing, Normal 0 false false false EN-IN...

Normal 0 false false false EN-IN X-NONE X-NONE MicrosoftInternetExplorer4

Demand pull inflation, Demand Pull Inflation: It describes a sustaine...

Demand Pull Inflation: It describes a sustained increase in the general price level that is caused by a permanent increase in nominal aggregate demand. Simply, is can be view

Atoms and molecules, who proposed the law of chemical combinations?

who proposed the law of chemical combinations?

Elasticity of demand, the price of a laptop increases by 20% and there is a...

the price of a laptop increases by 20% and there is a 40% drop in the quantity demanded

Source of economic growth and development, Question: (a) Explain the fa...

Question: (a) Explain the factors that contributed to the adoption of structural adjustment programme by a majority of Least Developed Countries in the 1980s? (b) Describe t

What is exchange rate, Q. What is Exchange Rate? Exchange Rate: The ‘pr...

Q. What is Exchange Rate? Exchange Rate: The ‘price' at which currency of one country can be converted into the currency of another country. A country's currency is ‘strong,'or

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd