Microeconomics (13th Edition)
13th Edition
ISBN: 9780134744476
Author: Michael Parkin
Publisher: PEARSON
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Question
Chapter 2, Problem 22APA
(a)
To determine
Identify the
(b)
To determine
Draw the
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On the following graph, use the blue line (circle symbol) to plot Nick's production possibilities frontier (PPF), and use the purple line (diamond symbol) to plot Rosa's PPF.
Nick and Rosa are farmers. Each one owns a 12-acre plot of land. The following table shows the amount of corn and rye each farmer can produce per year on a given acre. Each farmer chooses whether to devote all acres to producing corn or rye or to produce corn on some of the land and rye on the rest.
Corn
Rye
Nick
12
3
Rosa
15
5
(ROSA OR NICK) has an absolute advantage in the production of corn, and (ROSA OR NICK) has an absolute advantage in the production of rye.
Nick's opportunity cost of producing 1 bushel of rye is__________bushels of corn, whereas Rosa's opportunity cost of producing 1 bushel of rye is_________ bushels of corn. Because Nick has a(HIGHER OR LOWER) opportunity cost of producing rye than Rosa, (NICK OR ROSA) has a comparative advantage in the…
Diego and Kris are roommates. They spend most of their time studying, but they
leave some time for their favorite activities: making pizza and brewing root beer.
Diego takes 4 hours to brew a gallon of root beer and 2 hours to make a pizza. Kris
takes 6 hours to brew a gallon of root beer and 4hours to make a pizza.
a) What is each roommate's opportunity cost of making a pizza? Who has the
absolute advantage in making pizza? Who has the comparative advantage in
making pizza?
b)
If Diego and Kris trade foods with each other, who will trade away pizza in
exchange for root beer?
c)
The price of pizza can be expressed in terms of gallons of root beer, what is
the highest price at which pizza can be traded that would make both roommates
better off? What is the lowest price? Why?
Using the PPC in question A answer the following questions (c,d)
C. If the economy is producing 3 automobiles and 20 forklifts, what would you conclude about this economies use of resources?
D) What would production at a point outside the PPC indicate?
Chapter 2 Solutions
Microeconomics (13th Edition)
Ch. 2.1 - Prob. 1RQCh. 2.1 - Prob. 2RQCh. 2.1 - Prob. 3RQCh. 2.1 - Prob. 4RQCh. 2.1 - Prob. 5RQCh. 2.1 - Prob. 6RQCh. 2.2 - Prob. 1RQCh. 2.2 - Prob. 2RQCh. 2.2 - Prob. 3RQCh. 2.2 - Prob. 4RQ
Ch. 2.2 - Prob. 5RQCh. 2.3 - Prob. 1RQCh. 2.3 - Prob. 2RQCh. 2.3 - Prob. 3RQCh. 2.3 - Prob. 4RQCh. 2.3 - Prob. 5RQCh. 2.3 - Prob. 6RQCh. 2.3 - Prob. 7RQCh. 2.4 - Prob. 1RQCh. 2.4 - Prob. 2RQCh. 2.4 - Prob. 3RQCh. 2.4 - Prob. 4RQCh. 2.4 - Prob. 5RQCh. 2.4 - Prob. 6RQCh. 2.4 - Prob. 7RQCh. 2.5 - Prob. 1RQCh. 2.5 - Prob. 2RQCh. 2.5 - Prob. 3RQCh. 2 - Prob. 1SPACh. 2 - Prob. 2SPACh. 2 - Prob. 3SPACh. 2 - Prob. 4SPACh. 2 - Prob. 5SPACh. 2 - Prob. 6SPACh. 2 - Prob. 7SPACh. 2 - Prob. 8SPACh. 2 - Prob. 9SPACh. 2 - Prob. 10SPACh. 2 - Prob. 11APACh. 2 - Prob. 12APACh. 2 - Prob. 13APACh. 2 - Prob. 14APACh. 2 - Prob. 15APACh. 2 - Prob. 16APACh. 2 - Prob. 17APACh. 2 - Prob. 18APACh. 2 - Prob. 19APACh. 2 - Prob. 20APACh. 2 - Prob. 21APACh. 2 - Prob. 22APACh. 2 - Prob. 23APACh. 2 - Prob. 24APACh. 2 - Prob. 25APA
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