Question - Suppose either computers or televisions can be assembled with the following labor inputs:
|
Units produced
|
1
|
2
|
3
|
4
|
5
|
6
|
7
|
8
|
9
|
10
|
|
Total labor used
|
3
|
7
|
12
|
15
|
25
|
33
|
42
|
54
|
70
|
90
|
The following production possibility curves represent some of the combinations of outputs of computers and televisions given the labor inputs as shown in the table:
(a) Select the production possibilities curve for an economy with 42 units of labor.
(b) Using the table above, what is the opportunity cost of the sixth computer in terms of labor used for the potential production of televisions?
(c) Suppose our original economy of 42 units of labor brings in 28 more workers through immigration. Select the production possibilities curve that best reflects this added labor.
(d) Suppose advancing technology (e.g., the miniaturization of electronic circuits) increases the productivity of the 70-laborer workforce by 10 percent. Select the production possibilities curve that best reflects this advancing technology.