ESSENTIALS OF ECONOMICS
ESSENTIALS OF ECONOMICS
11th Edition
ISBN: 9781260225334
Author: SCHILLER
Publisher: RENT MCG
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Chapter 1, Problem 3P
To determine

(a)

To find: the opportunity cost of increasing missile production from 50 to 100.

To determine

(b)

To find: the opportunity cost of increasing missile production from 100 to 150.

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During the Second World War, Germany’s factories were decimated. It also suffered many human casualties, both soldiers and civilians. How did the war affect Germany’s production possibilities curve?
Construct a Production Possibilities Curve in Excel based on the following Production possibilities Schedule: Missiles       Milk (millions of gallons) 0                      4010                   34   20                   2730                   1940                   1050                     0 What is the "shape" or the "slope" of the frontier or curve? Calculate the opportunity cost of producing the "first" batch of 10 missiles. Calculate the opportunity cost of producing the "last" batch of 10 missiles. What would it mean if the economy was operating at the frontier? What would happen to the frontier if the production technology improves?
The opportunity cost of moving from point H to point G in the above picture is (specify amount and good, ie: 5009 guns)
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