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Suppose that a country's production possibilities are

Food(kilogram per month) Sunscreen(Litres per month)
300 0
200 50
100 100
0 150

a. Draw a graph of the country's PPF and describe how your graph illustrates a trdeoff.

b. If the country proudces 150 kilograms of food per month, how much sunscreen must it produce to achieve production efficiency?

c. find out the opportunity ocst of producing 1 kilogram of food and the opportunity cost of producing 1 litre of sunscreen?

d. What is the relationship between the opportunity costs in your answer to c?

e. Does the country face an increasing opportunity cost of food? What feature of a PPF illustrates increasing opportunity cost and why does your PPF not have this feature?

Microeconomics, Economics

  • Category:- Microeconomics
  • Reference No.:- M973013

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