Question

D Question 19 5 pts With its given resources and technology, an economy can produce either 100 units of good Y or 50 units of good X. For each of the following combinations of goods indicate whether the combination is NF (not feasible), FE (feasible and efficient), or FI (feasible but inefficient). Enter the two letters only NF 50 units of good Y and 30 units of good X 80 units of good Y and 10 units of good X FE 15 units of good Y and 40 units of good X FI

Answer 1

Answer 19 The curve of production possibility frontier (PPF) indicates the possible combinations of goods manufactured with the available resources in an economy In economics, the opportunity cost refers to the benefits given up by an individual or business when an alternative is chosen over another Suppose an economy can produce either 100 units of good Y and 50 units of good X using given resources. This implies that to produce more good Y, the economy must produce less of good X. The opportunity cost of producing 20 more of good Y is 10 units of good X, thus the opportunity cost of 1 good Y is 0.5 good X. The possible combinations of goods are Good X Good Y 50 40 30 20 10 0 0 20 40 60 80 100 These combinations lie on the PPF; thus, these combinations are feasible and efficient. Any combination of goods lies outside the PPF is not feasible because resources are not available to produce such a combination. Any combination lies inside the PPF is feasible but not efficient because the combination can be produced given the resources which makes it feasible but less of both goods is produced which makes it inefficient. 50 units of good Y ad 30 units of good X -NF - not feasible because it lies outside the PPF 80 units of good Y and 10 units of good X - FE feasible and efficient because it lies on the PPF 15 units of good Y and 40 units of good X- FI - feasible but inefficient because it lies inside the PPF

Answer 14 A person J can produce either 50 pounds of vegetables or 10 pounds of chicken. This implies that to produce more chicken, the economy must produce less of vegetables. The opportunity cost of producing 1 pound of vegetable person has to give up 0.2 pounds of chicken. 1 pound of vegetable 0.2 pound of chicken It can also have said that to produce 1 pound of chicken person have to give up 5 pounds of vegetables. 1 pound of chicken -5 pounds of vegetables If John wants to produce 10 pounds of chicken, then he must give up 50 pounds vegetables. If John wants to produce 1 pound of chicken, then he must give up 5 pounds vegetables. If John wants to produce 2 pounds of chicken, then he must give up 10 pounds vegetables. Answer 6 An implicit cost refers to the cost occurred when the resources are used and not shown as a direct expense. It is also called imputed or opportunity cost The time spend by a person in researching car models is an example of implicit cost because it is imputed cost and the value of time cannot be determined precisely Hence, the first option is correct-you spend 10 hours researching different car models before you buy your new car