Spring $2024$

Dr$.$ Blackstone

The Production$-$Possibilities Curve

Part A$.$ Rosencrantz

In the country of Rosencrantz only two goods are produced, ham and eggs.

The production$-$possibilities schedule for these goods is given below.

$\backslash$table$[[$Ham$\_$ Eggs,$],[0,40],[1,36],[2,30],[3,22],[4,12],[5,0]]$

Graph Rosencrantz's production$-$possibilities curve in Figure A$.$ using these data. $($Put eggs on the horizontal axis$).$

The opportunity cost of increasing ham production in this country from $2$ units to $3$ is

The opportunity cost of increasing egg production from $22$ to $23$ units is approximately

True or False: Given itsexisting resources, institutions and technology, Rosencrantz is capable of producing $\frac{31}{2},$ units of ham and $20$ units of eggs.

True or False: Given its existing resources, institutions, and technology, Rosencrantz is capable of producing $\frac{41}{2}$ units of ham and $5$ units of eggs

Plot the production points given in the preceding two problems in Figure A$.$

A new type of chicken feed is invented which increases egg production by $50\%.$ The new feed costs exactly the same amount as the old. Draw in the new production$-$possibilities curve in Figure A$.$

True or False: Rosencrantz's production$-$possibilities curve exhibits thelaw of increasing cost