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  • Economics (Drawing Curve)

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    phone thansin thwin
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    The document discusses a country's production possibility curve and the opportunity cost of producing more goods. Currently the country produces 40 units of goods and 70 units of services. The opportunity cost of producing an additional 10 units of goods is 5 units of services. A production possibility curve shows that a country must choose between producing more goods or services, and producing extra goods requires sacrificing the production of services, which is the opportunity cost.

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    The document discusses a country's production possibility curve and the opportunity cost of producing more goods. Currently the country produces 40 units of goods and 70 units of services. The opportunity cost of producing an additional 10 units of goods is 5 units of services. A production possibility curve shows that a country must choose between producing more goods or services, and producing extra goods requires sacrificing the production of services, which is the opportunity cost.

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    © All Rights Reserved
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    5 views2 pages

    Economics (Drawing Curve)

    Uploaded by

    phone thansin thwin
    The document discusses a country's production possibility curve and the opportunity cost of producing more goods. Currently the country produces 40 units of goods and 70 units of services. The opportunity cost of producing an additional 10 units of goods is 5 units of services. A production possibility curve shows that a country must choose between producing more goods or services, and producing extra goods requires sacrificing the production of services, which is the opportunity cost.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
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    of 2

    1.

    (a)

    Country’s production possibility curve


    (b) Assuming that the country is currently producing 40 units of goods and 70 units of services, the
    opportunity cost of producing another 10 units of goods is 5 units of services.

    (c) A production possibility curve illustrates the microeconomic issues of choice and opportunity cost. If
    the country chose to produce more goods, it would have to sacrifice the production of services. This
    sacrifice of services is the opportunity cost of the extra goods.

    (d)

    The new production possibility curve

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