Homework #1

# Homework #1 - Economics 102-02 Spring 2012 Homework#1 Due...

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Economics 102-02 Spring 2012 Homework #1 Due February 8, 2012 Evelyn Tavares 1. United States Production The following production possibilities table data represent the amount of apples and oranges grown in the United States in an hour. Apples Oranges A 20,000 0 B 15,000 10,000 C 10,000 20,000 D 5,000 30,000 E 0 40,000 a. Plot the above options as a production possibilities curve, placing apples on the y-axis and oranges on the x-axis. b. What is the value for the y-intercept on this graph? The value is 20,000 c. Solve for the slope between each point, or option, on the graph. Slope E to D= -5/10 = -1/2 = - 0,5 Slope D to C= - 5/10= - 1/2 = -0,5 Slope C to B= -5/10 = - 1/2 = -0,5 Slope B to A= -5/10 = -0,5 d. State the cost ratio of apples to oranges between each point, or option, on the graph. Cost Ratio E to D - 1 apple = 2 Oranges 1/2 apple = 1 Orange For every apple produced 2 orange are not being produced. Cost Ratio D to C- 1 apple = 2 Oranges 1/2 apple = 1 Orange For every apple produced 2 orange are not being produced. Cost Ratio C to B - 1 apple = 2 Oranges 1/2 apple = 1 Orange For every apple produced 2 orange are not being produced. Cost Ratio B to A -

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Homework #1 - Economics 102-02 Spring 2012 Homework#1 Due...

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