1. Assume the graph below is about headphones. (2 points) a) Explain what point A means: Answer. b) What caused the reduction in sales from 80 headphones to 60? Explain your reasoning. Answer. S 16 12 D 60 80 Q2. Assume the graph below is about jeans. (2 points) a) What's happening when the price is $30 per pair of jeans? Answer. b) What would have happened that would have caused the seller to inventory 45,000 pairs of jeans instead? Explain why. Answer Price $30 Supply $25 $20 $15 $10 SO J Quantity 10 20 30 40 50 60 70 80 (in Thousands) 3. Explain the following: (3 points) a) Why the opportunity cost of producing 9 units of butter is zero guns produced (as in 120 guns sacrificed): Answer. b) Why the opportunity cost of producing 100 units of guns is 4 units of butter. Answer. c) What the approximate opportunity cost is for producing 60 units of guns