What feature of a PPF illustrates increasing opportunity cost? Explain why
Yucatans opportunity cost does or does not increase.
If opportunity costs increase, the PPF bows outward. Yucatans PPF is linear
and along a linear PPF the opportunity cost is cons
Identify the quantity of malaria eradicated that achieves allocative
Shows a marginal cost curve and a marginal benefit curve that are
consistent with Dr. Kochis views. Dr. Kochi believes that the last 10
Sketch the PPF for ethanol and other goods and services for the United States.
a. Do you expect the opportunity cost of producing ethanol in the United
States to have increased since 2003? Explain why.
If there have been no technological changes in the pr
Explain why the United States does not produce tea and instead imports it from
The United States imports tea from India because it is cheaper for the U.S. to
import tea than to produce it in the United States. Fewer other goods and services
What are the social institutions that Cuba might lack that help the United States
to achieve allocative efficiency?
Of the four social institutions, firms, money, markets, and property rights,
Cubas economy has firms and money. Markets, however, are less
PPFs is that the opportunity cost of producing tea is lower in India. The magnitude of
the slope of the PPF is equal to the opportunity cost of producing tea, so the U.S. PPF
is steeper than Indias PPF.
Sketch marginal cost curves for the production of te
Show how both the United States and Brazil can gain from specialization and trade.
In general, the United States gains from trade with Brazil by importing
ethanol from Brazil. Brazil produces ethanol at a lower opportunity cost than the
United States, so
Explain why Harry would be worse off getting a grade higher than your answer to
If Harry studied for enough hours to get a higher grade, he would have fewer
hours to play tennis. Harrys marginal benefit from tennis would be greater than
a. Who now has a comparative advantage in producing jackets?
Sue forgoes 40 caps to produce 4 jackets, so Sues opportunity cost of
producing one jacket is (40 caps)/(4 jackets) or 10 caps per jacket. Tessa
forgoes 80 caps to produce 20 jackets, so Tessas
Is the farm more efficient with the new technology than it was with the old one?
The farm is able to produce more with the new technology than with the old,
but it is not necessarily more efficient. If the farm was producing on its PPF
before the new