Question

O ou LOI- If you were to graph the production possibilities frontier (PPF) with military output on the horizontal axis, and civilian goods and services on the vertical axis, and if the PPF were curved, where would you expect the opportunity cost of military output to be highest? A Where the PPF intersects the horizontal axis B. Where the PPF intersects the vertical axis Nowhere in particular, because the opportunity cost is constant At the point on the PPF where military output is highest At the point on the PPF where military output is lowest A. and E. B. and D. A. and D. B. and E. If it takes 2 lumps of wax to make a votive candle, and 6 lumps to make a pillar candle, what is the production function for pillar candles? (Assume Qp is the number of pillar candles made, and Wp is the number of lumps of wax devoted to making pillar candles.) A. Qp = 1/3 Qv B. Qp = 3 Qv C. 12 = 1/6 Qp + 2 Qv D. Qp = 6 Wp Qp = 1/6 Wp F. 24 = Wy + Wp

Answer 1

Answer 1. where the ppf intersect the horizontal axis.

reason- At this point, military goods output is highest and civilian goods and services outout is zero.

Opportunity cost of military goods = ∆ in output of civilian good/ ∆ in output of military good.

Opportunity cost rises as we move from production of civilian good to military good.

Also, the curve is steepest at than level, so opportunity cost, the slope of PPF is also highest.

Answer 2. Qp=6Wp

reason- production function of pillar candles= Qp and it takes 6 Wp to make 1 Qp.

So Qp=6Wp