Questions on Macro Economic Please make sure that you shift the points Question

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Questions on Macro Economic

Please make sure that you shift the points

Question 7 of 16 Mapoob sapling learning Suppose that the economy of Somerville creates only wind turbines and pinatas. Below is the production possibilities frontier (PPF) of Somerville per year, currently producing at the point labeled A. Points B and C start out stacked on top of point A, but you will move them. Pay attention to the axis values for each point, and enter your answers in thousands, specified to one decimal place Shift point B to show the economy efficiently producing one thousand more wind turbines his has an opportunity cost of thousand pinatas Shift point C to indicate Somerville increasing production of wind turbines from point B by another thousand. The shift from point B to C has an opportunity cost of Number 2.02 thousand pinatas This PPF exhibits opportunity costs O increasing O constant O decreasing 5.0 Quantity of pinatas produced (thousands)

Explanation / Answer

If we do that, the pinates will dip down to 3.5 turbines from 5. Opportunity cost = 1.5 (thousands)

It is displaying increasing opportunity cost as quantity of turbines and pinatas are not the same.

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