Question

. Opportunity cost and production possibilities Ana is a skilled toy maker who is able to produce both boats and drums. She has 8 hours a day to produce toys. The following table shows the daily output resulting from various possible combinations of her time. urs Pr oducin Produced 6 4 4 6 8 10 16 19 20 0 0 On the following graph, use the blue points (circle symbol) to plot Ana's initial production possibilities frontier (PPF) Inital PP New PPF Suppose Ana is currently using combination D, producing one boat per day. Her opportunty cost of producing a second boat per day is per day S Now, suppose Ana is currently using combination C, producing two boats per day. Her opportunity cost of producing a third boat per day is per day From the previous analysis, you can determine that as Ana increases her production of boats, her opportunity cost of producing one more boat Suppose Ana buys a new tool that enables her to produce twice as many boats per hour as before, but it doesn't áffect her ability to produce drums, Use the green points (triangle symbol) to plót her new PPF on the previous graph. Because she can now make more boats per hour, Ana's opportunity cost of producing drums is previously it was

Answer 1

1a 2.1 4, 16 3,lo 19-63 Fsem