In real life, the PPF will NOT be linear; it will be a downward sloping curve because of the law of diminishing marginal returns. In a world of scarcity choosing one thing means giving up something else. The opportunity cost of producing the first 500 Toyota is 600. Answer: No. Opportunity Cost and PPF Questions.doc - PPF and Opportunity cost questions ANSWER ON YOUR OWN PAPER Maximum possible combinations of food and clothing, 1 out of 1 people found this document helpful, Maximum possible combinations of food and, clothing that can be produced in a given period of, 1.Draw a Production Possibilities graph for, from producing 4 million units of food to, from producing 6 million units of clothing, 4.What is the opportunity cost of switching, 6.Why do you think production possibilities, Suppose massive new sources of oil and coal are found within the, economy and there are major technological innovations in both, sectors of the economy. a. Course. 28 Questions Show answers. The production possibility frontier (PPF) for computers and textbooks is shown here. a. Consider the PPF diagram below. What is the opportunity cost of moving from producing 6 million units of clothing to 7 million units of clothing? answer choices . 2.What is the opportunity cost of moving from producing 4 … Q. Mythica, which is a hypothetical economy, produces only two goods – textbooks and computers. Tags: Question 26 . l a� � � � $$If a$n kd� $$If �l � �0 ��9t" � ; �0 � � � � � � ��"6� � �� � �� � �� � �4� Production Possibilities Frontier Questions Honors Economics Name:____ REFER TO THE ABOVE DIAGRAM WHEN ANSWERING THE FOLLOWING QUESTIONS. Angela is a college student. (d) Along a bowed out PPF as more of a good is produced, the opportunity cost of producing it decreases. When it uses all of its resources, it can produce five million computers and fifty five million textbooks. PPF and Opportunity cost questions ANSWER ON YOUR OWN PAPER! On the most fundamental level, the opportunity cost of moving from D to C is the butter given up to produce the extra guns. Course Hero, Inc. Examples of opportunity costs . So I have to give up, on average, 40 berries. This means the opportunity cost is also CONSTANT. 3 Question 2 (using above diagram) Question 3 (using above diagram) 4 Question 4 Question 5 The diagram refers to production possibility frontiers for a country that produces capital goods and consumer goods. Which curve in the diagram would. Draw a PPF for this economy. (a) The opportunity cost of moving from point b to c is 10 units of butter. Question 1 . However, there is a different style of PPF curve (for a start, it actually looks curvy). 2. � Dayne Lee. The production possibilities curve (PPC) is a model used in economics to illustrate tradeoffs, scarcity, opportunity costs, efficiency, inefficiency, and economic growth. Im looking through my book and i see that i have made a note on ppfs' i wrote that "to show rising opportunity cost we must assume maximum efficiancy plus factors of production are not perfectly reallocateable" and next to ithe ppf diagram i noted "we used the best facotrs first" I understand that it has to be max. right. The cost of producing one more coffee is giving up 1.5 muffins. Calculate The Opportunity Cost Of Pens If The Supplier Moves From Possibility C To Possibility D. B. The last option is the most attractive, so Cliff should be the first who is assigned to do the posters. If you see a straight PPF, it means that there is a constant opportunity cost. Explain in your words why it is this shape. � Production Possibilities Frontier-used to illustrate opportunity cost ~An economic model showing all possible combinations of two goods which can be produced given that:-Resources are fixed (quantity and quality)-Technology is fixed-There are only TWO goods. Swinburne University of Technology. �= �= A �� �� �� � � � ���� # T � . Which statements about the Production Possibilities Frontier are true? I have to stay on the production possibilities frontier, sometimes abbreviated as PPF. A � � � � � � � � � If you ask Adam to make posters, the opportunity cost of each poster is 400 entries. ... you should never see a the ppf shift which way? Image Transcriptionclose. Opportunity cost = 1500-1000 = 500 Toyotas. Have a go! Academic year. Calculations: 5000-4400. (b) Economic growth causes the PPF to shift outward (c) From a point within the PPF rearranging production and producing more of all goods is possible. She takes a full load of classes and has only 5 hours per week for her hobby. a) 5 coconuts. What is the opportunity cost of moving from producing 4 million units of food to 5 million units of food? l a� � � � � � � � $$If a$n kdT $$If �l � �0 ��9t" � ; �0 � � � � � � ��"6� � �� � �� � �� � �4� SURVEY . 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