Unit 2 In-Class Exercise.docx - Arijion Parker ECO201 01D...

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Arijion ParkerECO201 01DSeptember 6, 2016Unit 2—Production Possibilities and Comparative AdvantageA farmer has 10 acres of land and has to choose between planting coffee trees and tea bushes. The table shows the production (in thousands of pounds) of coffee and tea as a function of the number of acres planted with coffee. In the space below, graph theproduction possibility frontier between coffee and tea.12345678910 11024681012Based on the table and your graph, which of the following combination(s) of coffee and tea output is (are) attainable?a.(4.9, 3)c. (4.4, 3.5)e. All of the combinationsb.(2.8, 8)d. Combinations a. and c.f. None of the combinations
What is the opportunity cost in terms of tea of increasing coffee production from 4,000 to 4,900 pounds?

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