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1 Assignment
1 Assignment
Question: 1| Inhabitants of Rangpur can grow potatoes and catch fish in respective
combinationCombinations
A
B
C
D
E
F
a) Draw a PPF with potatoes on the horizontal axis and fish on vertical axis illustrating
combinations (A-F)
b) Can inhabitants of Rangpur produce 500 pounds of fish and 800 pounds of potatoes,
explain?
c) What is the opportunity cost of increasing the annual output of potatoes from 600 to 800
pounds?
d) What is the opportunity cost of increasing the annual output of potatoes from 200 to 400
pounds?
e) Explain why the answers to parts (c ) and (d) are not the same? What does this imply
about the slope of the PPF? (Hints: Different slope means different opportunity cost)
a) Explain the efficient trade-offs for Company T after drawing a PPF with Butter on the
horizontal axis and Guns on vertical axis?
b) Explain why point I is unattainable and U is inefficient?
c) With technological improvement can possibility (I) be efficient trade-off for company T?
(Hints: Show the shift of the curve and explain why)
Question: 3|
USA
Computer
Car
10
5
JAPAN
6
8
Opportunity cost
of JAPAN
Computer
Car
---------------Estiaque Bari