Jake is a talented artist who sells hand-crafted goods on his website. Jake currently crafts and sells both tea towels and embroidered sweaters. He spends 8 hours a day working on crafts. The following table gives different daily output scenarios depending on how much of his time is spent on each good. Choice A B C D E EMBROIDERED SWEATERS 25 20 15 10 5 0 On the following graph, use the blue points (circle symbol) to plot Jake's initial production possibilities frontier (PPF). 0 1 (Tea towels) 8 6 4 2 2 0 Hours Crafting 3 4 TEA TOWELS (Embroidered sweaters) 0 2 4 6 8 5 6 7 8 Initial PPF A (Tea towels) 4 3 2 1 0 New PPF Produced ? (Embroidered sweaters) 0 12 17 19 20 Suppose Jake is currently using combination D, producing one tea towel per day. His opportunity cost of producing a second tea towel per day is per day. Now, suppose Jake is currently using combination C, producing two tea towels per day. His opportunity cost of producing a third tea towel per day is per day. From the previous analysis, you can determine that as Jake increases his production of tea towels, his opportunity cost of producing one more tea towel Suppose Jake buys a new tool that enables him to produce twice as many tea towels per hour as before, but it doesn't affect his ability to produce embroidered sweaters. Use the green points (triangle symbol) to plot his new PPF on the previous graph. Because he can now make more tea towels per hour, Jake's opportunity cost of producing embroidered sweaters is it was previously.
Jake is a talented artist who sells hand-crafted goods on his website. Jake currently crafts and sells both tea towels and embroidered sweaters. He spends 8 hours a day working on crafts. The following table gives different daily output scenarios depending on how much of his time is spent on each good. Choice A B C D E EMBROIDERED SWEATERS 25 20 15 10 5 0 On the following graph, use the blue points (circle symbol) to plot Jake's initial production possibilities frontier (PPF). 0 1 (Tea towels) 8 6 4 2 2 0 Hours Crafting 3 4 TEA TOWELS (Embroidered sweaters) 0 2 4 6 8 5 6 7 8 Initial PPF A (Tea towels) 4 3 2 1 0 New PPF Produced ? (Embroidered sweaters) 0 12 17 19 20 Suppose Jake is currently using combination D, producing one tea towel per day. His opportunity cost of producing a second tea towel per day is per day. Now, suppose Jake is currently using combination C, producing two tea towels per day. His opportunity cost of producing a third tea towel per day is per day. From the previous analysis, you can determine that as Jake increases his production of tea towels, his opportunity cost of producing one more tea towel Suppose Jake buys a new tool that enables him to produce twice as many tea towels per hour as before, but it doesn't affect his ability to produce embroidered sweaters. Use the green points (triangle symbol) to plot his new PPF on the previous graph. Because he can now make more tea towels per hour, Jake's opportunity cost of producing embroidered sweaters is it was previously.
Principles of Economics 2e
2nd Edition
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:Steven A. Greenlaw; David Shapiro
Chapter2: Choice In A World Of Scarcity
Section: Chapter Questions
Problem 12RQ: Why is a production possibilities frontier typically drawn as a curve, rather than a straight line?
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Transcribed Image Text:Jake is a talented artist who sells hand-crafted goods on his website. Jake currently crafts and sells
both tea towels and embroidered sweaters. He spends 8 hours a day working on crafts. The
following table gives different daily output scenarios depending on how much of his time is spent
on each good.
Choice
A
B
с
D
E
MBROIDERED SWEATERS
25
10
0
1
(Tea
towels)
8
6
4
2
2
0
Hours Crafting
3
On the following graph, use the blue points (circle symbol) to plot Jake's initial production
possibilities frontier (PPF).
4
TEA TOWELS
5
(Embroidered
sweaters)
0
2
4
6
6
8
7
8
O
Initial PPF
A
(Tea
towels)
4
New PPF
3
2
1
0
(?)
Produced
(Embroidered
sweaters)
0
12
17
19
20
Suppose Jake is currently using combination D, producing one tea towel per day. His opportunity
cost of producing a second tea towel per day is
per day.
Now, suppose Jake is currently using combination C, producing two tea towels per day. His
opportunity cost of producing a third tea towel per day is
per day.
▼
From the previous analysis, you can determine that as Jake increases his production of tea towels,
his opportunity cost of producing one more tea towel
Suppose Jake buys a new tool that enables him to produce twice as many tea towels per hour as
before, but it doesn't affect his ability to produce embroidered sweaters. Use the green points
(triangle symbol) to plot his new PPF on the previous graph.
Because he can now make more tea towels per hour, Jake's opportunity cost of producing
embroidered sweaters is
it was previously.
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