a) Gerry is a chef in a popular restaurant. He has limited time to help prepare for
Question:
a) Gerry is a chef in a popular restaurant. He has limited time to help prepare for a party. Study the table below, which shows
Gerry's production possibilities. Calculate the opportunity cost of going from producing 2 sandwiches to 3 sandwiches. Show
your work.
Sandwiches | Desserts |
0 | 10 |
1 | 9 |
2 | 6 |
3 | 0 |
b) Draw a correctly labeled PPC using the data from the table above.
c) Does this PPC indicate increasing, decreasing, or constant opportunity cost? Explain.
d) Think of two goods that might have a constant opportunity cost of production. Draw and label a PPC for them. You do not
need to make a table or define specific data quantities on the axes. Label which good is represented on each axis.
e) On your graph from part d, label an efficient and inefficient point of production (two separate points).