Production Possibilities Curve The owner of a company that produces fishing equipment would like for you to do some economic analysis to help determine if he should spend his time producing fishing rods or fishing lures. You need to provide him with an accurate PPC that labels all scenarios. He would like to know why he hasn't reached his goal of selling 300 rods and 2,500 lures. He would also like to know your opinion of his production last year when he sold 110 rods and 2,414 lures. This year he has tried a new strategy of spending all of his time making rods (Scenario A) and would like to know the opportunity cost of changing his business model to Scenario B. Do you think this would be a good change for the owner of the business? Why or why not?. Lastly, his goal was to sell 300 rods and 2,500 lures. What are two things he could do that might allow him to reach that goal (be specific to the scenario)? Scenario A B C D E F Fishing Rods 300 240 180 120 60 0 Fishing Lures 0 1800 3300 4500 5400 6000

Production Possibilities Curve The owner of a company that produces fishing equipment would like for you to do some economic analysis to help determine if he should spend his time producing fishing rods or fishing lures. You need to provide him with an accurate PPC that labels all scenarios. He would like to know why he hasn't reached his goal of selling 300 rods and 2,500 lures. He would also like to know your opinion of his production last year when he sold 110 rods and 2,414 lures. This year he has tried a new strategy of spending all of his time making rods (Scenario A) and would like to know the opportunity cost of changing his business model to Scenario B. Do you think this would be a good change for the owner of the business? Why or why not?. Lastly, his goal was to sell 300 rods and 2,500 lures. What are two things he could do that might allow him to reach that goal (be specific to the scenario)? Scenario A B C D E F Fishing Rods 300 240 180 120 60 0 Fishing Lures 0 1800 3300 4500 5400 6000

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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