Assume that Atlantis and the Mushroom Kingdom use equal resources to produce consumer and capital goods,...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Assume that Atlantis and the Mushroom Kingdom use equal resources to produce consumer and capital goods, as illustrated in the table below showing maximum possible production figures. Country Capital Goods Consumer Goods 60 units 180 units Mushroom Kingdom 20 units 100 units Atlantis a. Draw a fully labeled production possibility curve for Atlantis. Place capital goods on the vertical axis and consumer goods on the horizontal axis. Assume constant opportunity cost. b. On your graph from part (a), label an inefficient point of production I, an efficient point of production E, and an unattainable point of production U. c. Which country has the comparative advantage in the production of capital goods? Explain. d. If Atlantis shifted from producing 10 units of capital goods and 150 units of consumer goods to producing 24 units of capital goods and 108 units of consumer goods, what would be the impact on its economic growth in the long run? e. Based on the data table, what range of capital goods could be traded for 15 units of consumer goods that would be mutually beneficial? Assume that Atlantis and the Mushroom Kingdom use equal resources to produce consumer and capital goods, as illustrated in the table below showing maximum possible production figures. Country Capital Goods Consumer Goods 60 units 180 units Mushroom Kingdom 20 units 100 units Atlantis a. Draw a fully labeled production possibility curve for Atlantis. Place capital goods on the vertical axis and consumer goods on the horizontal axis. Assume constant opportunity cost. b. On your graph from part (a), label an inefficient point of production I, an efficient point of production E, and an unattainable point of production U. c. Which country has the comparative advantage in the production of capital goods? Explain. d. If Atlantis shifted from producing 10 units of capital goods and 150 units of consumer goods to producing 24 units of capital goods and 108 units of consumer goods, what would be the impact on its economic growth in the long run? e. Based on the data table, what range of capital goods could be traded for 15 units of consumer goods that would be mutually beneficial?
Expert Answer:
Answer rating: 100% (QA)
a Production Possibility Curve for Atlantis Identify the maximum production levels for capital goods and consumer goods for Atlantis from the data tab... View the full answer
Related Book For
Macroeconomics
ISBN: 978-1319120054
3rd Canadian edition
Authors: Paul Krugman, Robin Wells, Iris Au, Jack Parkinson
Posted Date:
Students also viewed these economics questions
-
Using the additional operating data provided in Table 2, compute revenue quantity variance and price variance for annual ticket revenue and state whether each is favorable or unfavorable. What do we...
-
Jacobson Company purchased a parcel of land for a new office building. The cost of the land was $310,000. An old building on the property wad demolished and construction began on the new building....
-
An economy has two firms and 75 consumers. The two firms pollute. Firm 1 has a savings function S1(e)=20e2.5e2, where e is the quantity of emissions from the firm. Firm 2 has a savings function...
-
The General Auditors Office (GAO) of ABC jurisdiction issued a report on the XYZ Electric Cooperative, a large member-owned utility. This report reviewed the work of MNO Consulting. MNO found...
-
The beginning balance sheet of New Technology Corporation included the following: Long-Term Investment in MSC Software (equity-method investment) ............... $619,000 New Technology completed the...
-
Provide examples of successful waterflooding operations in petroleum and natural gas reservoirs 2.Analyze the reservoir properties, waterflooding techniques, injection water management strategies,...
-
When should a board consider forming a governance, development, audit, membership, and compensation committee? Or should any of these be task forces?
-
James Kirk is a financial executive with McDowell Enterprises. Although James Kirk has not had any formal training in finance or accounting, he has a good sense for numbers and has helped the company...
-
Summarize the videos called "Why Are There So Many More Crisis Pregnancy Center than Abortion Clinics and "Misconception, The Fake Abortion Centers of America" Be sure to discuss: What types of...
-
On December 31, 2021, the end of its first year of operations, Botani Associates owned the following securities that are held as long-term investments. On this date, the total fair value of the...
-
Compose the function f and g and determine, from your answer, if the functions f and g are inverses of each other. (a) f(x) = (x+3) - 7, g(x) = x+7-3. (Assume the domain of f(x) is [-3, ).) (b) f(x)...
-
Two items are omitted from each of the following three lists of cost of goods manufactured statement data. Determine the amounts of the missing items, Identifying them by letter. Work in process...
-
Calculate the amount of sod in square yards that is needed for the irregular area shown. Recalculate the amount of sod for the illustration shown if the dimensions are meters instead of feet. Answer...
-
Use the following data to find the direct labor efficiency variance if the company produced 3 , 5 0 0 units during the period. Direct labor standard ( 4 hours @ $ 7 . 0 0 / hour ) $ 2 8 . 0 0 per...
-
Develop an algorithm using the Java programming language that implements a basic stack data structure. Your stack must have the ability to push entries on the stack. Your stack must also have the...
-
Johnny who worked in England came to Canada with his wife Betty on holiday. He later returned to England alone, Betty remaining in Canada for health reasons. Johnny promised to pay Betty $5,000 per...
-
Solve the following questions using the data given below. Stocks X Y Other Betas X Y Mean Return 8 12 X Y Correlations X and Y 0.3 Covariance with the market 4 2 Market Variance Factor1 1.2 0.5 RF...
-
Economic feasibility is an important guideline in designing cost accounting systems. Do you agree? Explain.
-
a. The accompanying table shows gross domestic product (GDP), disposable income (YD), consumer spending (C), and planned investment spending (I Planned ) in an economy. Assume there is no government...
-
In which of the following cases is it more likely for efficiency wages to exist? Why? a. Jane and her boss work as a team selling ice cream. b. Jane sells ice cream without any direct supervision by...
-
The accompanying diagram shows the interest rate on one-year loans and inflation during 20012016 in the economy of Albernia. When would one-year loans have been especially attractive and why?...
-
The following balance sheet and income statement data were taken from the financial records of The Dana Point Company: \ Required Prepare percentage change and common-sized balance sheets and income...
-
The following balance sheet and income statement data were taken from the financial records of The Dana Point Company: Required 1. Calculate the following ratios for The Dana Point Company for 2015...
-
The Artic Company's income statement and comparative balance sheets at December 31 of 2019 and 2018 are shown below: Cash dividends of \(\$ 40,000\) were declared and paid during 2019. Plant assets...
Study smarter with the SolutionInn App