Sign up for FREE

Production Possibilities Curve

Last updated over 2 years ago

6 questions

1

Question 1

1.

1

1

1

1

1

Create a line graph that represents the trade-off of orange vs. apple production for Washington. 

Hint: x-axis for oranges, y-axis for apples. 

Your line should have a curve in it. DO NOT DRAW A STRAIGHT LINE.

Then, put a star on the graph where production is impossible. Put a triangle on the graph that shows an inefficient use of resources.

.

Question 2

2.

What's the opportunity cost (in apple units) of producing the first unit of oranges for Washington?

Question 3

3.

What if there was a new organic, sustainable, environmentally friendly fertilizer that increased ALL fruit tree growth, oranges and apples, both. Redraw the original PPC and then draw a new hypothetical PPC in a different color with the new fertilizer.

Question 4

4.

Quickly resketch (don't plot again) the original PPC from question 1.

Highlight red all the places on the graph that represent the combinations of production outcomes that are impossible?

Highlight green where the combination of production outcomes are possible?

Question 5

5.

Quickly resketch (don't plot again) the original PPC from question 1.

Highlight where you see the law of diminishing marginal returns in effect. (Think of the opportunity cost from point E to F.)

Question 6

6.

Simply put, the PPC shows

how much of two products a person/group of people can consume given its scarce resources.

how much you care.

how much of two products a person/group of people can make given its scarce resources.