(a) Determination of opportunity cost .

Question

1. Use the graph below to answer the following questions. a) If Alison is currently growing 80 bunches of kale per period, how many radish bunches is she growing? Assume that resources are fully utilized. b) What is the opportunity cost of one bunch of radishes? c) What is the opportunity cost of one bunch of kale? d) If Alison is currently producing 30 bunches of radishes, what is the opportunity cost of producing another 20 bunches of radishes? e) Is it possible for Alison to produce 120 bunches of kale and 30 bunches of radishes? f) If Alison is producing 60 bunches of radishes and 30 bunches of kale, is she fully utilizing her resources? g) Is the opportunity cost of this PPF constant? Kale (bunches) 180 160 140 120 100 20 40 60 Radishes (bunches) "L'PL 80 100

Answer 1

Question

Chapter 3, Problem 6P

To determine

(a)

Determination of opportunity cost.

To determine

(b)

The identify opportunity cost while moving to Point D from Point I.

To determine

(c)

The identify opportunity cost while moving to Point B from Point C.

To determine

(d)

The identify efficient point on the curve.

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1. Use the graph below to answer the following questions. a) If Alison is currently growing 80 bunches of kale per period, how many radish bunches is she growing? Assume that resources are fully utilized. b) What is the opportunity cost of one bunch of radishes? c) What is the opportunity cost of one bunch of kale? d) If Alison is currently producing 30 bunches of radishes, what is the opportunity cost of producing another 20 bunches of radishes? e) Is it possible for Alison to produce 120 bunches of kale and 30 bunches of radishes? f) If Alison is producing 60 bunches of radishes and 30 bunches of kale, is she fully utilizing her resources? g) Is the opportunity cost of this PPF constant? Kale (bunches) 180 160 140 120 100 20 40 60 Radishes (bunches) "L'PL 80 100

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