Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

1. Use the following data to work Problems a to g. Ethanol (barrels per day) 70 64 54 40 22 0 Food crops (tons

1. Use the following data to work Problems a to g. Ethanol (barrels per day) 70 64 54 40 22 0and and and and and and Food cr 

1. Use the following data to work Problems a to g. Ethanol (barrels per day) 70 64 54 40 22 0 Food crops (tons per day) and 0 and 1 and 2 and 3 and 4 and 5 Brazil produces ethanol from sugar, and the land used to grow sugar can be used to grow food crops. The table to the right sets out Brazil's production possibilities for ethanol and food crops. a. Draw a graph of Brazil's PPF and explain how your graph illustrates scarcity. b. If Brazil produces 40 barrels of ethanol a day, how much food must it produce to achieve production efficiency? c. Why does Brazil face a tradeoff on its PPF? d. If Brazil increases ethanol production from 40 barrels per day to 54 barrels per day, what is the opportunity cost of the additional ethanol? e. If Brazil increases food production from 2 tons per day to 3 tons per day, what is the opportunity cost of the additional food? f. What is the relationship between your answers to parts (d) and (e)? g. Does Brazil face an increasing opportunity cost of ethanol? What feature of Brazil's PPF illustrates increasing opportunity cost?

Step by Step Solution

3.47 Rating (160 Votes )

There are 3 Steps involved in it

Step: 1

A PPF Let Food is on ... blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Principles of Economics

Authors: Fred M. Gottheil

7th edition

978-1133962069, 9781285064444, 1133962068, 1285064445, 978-1285064437

More Books

Students also viewed these Finance questions

Question

What arguments justify people living off interest derived income?

Answered: 1 week ago

Question

What factors change the rate of interest?

Answered: 1 week ago