Production Alternatives Type of Product A B C D E F G Butter 0 1 2 3 4 5 6 Guns 14 13 11 9 7 4 0
I was able to create the production possibilities table and curve for the information above. However, I'm having challenges with analyzing the graphed data. Below are specific questions assigned. Are you able to please assist me?
- Identify the specific assumptions that underlie the production possibilities curve.
- Determine the cost of more butter, if the economy is at point C. What would be the cost of producing more guns? How does the shape of the production possibilities curve reflect the last of increasing opportunity costs?
- Supposed the hypothetical economy were producing only 1 item of butter and 10 guns, and this was depicted by this production possibilities table and curve. What conclusions could you draw about this economy's resource utilization?
- Determine this economy is able to produce outside its current production possibilities. How might technological changes affect the production possibilities curve? How can international trade allow consumption above its production possibilities curve?
I need assistance is analyzing the graph and applying it to the questions above.