Good afternoon,

Can someone please advise if I answered the below correctly?

Answer the following questions and submit your answers to the mentor by the date indicated in the Course Calendar. The questions are worth a total of 100 points.[MO 2.2]

1. On one graph, draw and label all of the following:
2. A production possibility frontier (PPF) which assumes a budget of $40, a price for pizzas of $10, and a price of $2 for a 2-liter bottle of cola(11 points)
3. A point on the graph that is efficient(11 points)
4. A point on the graph that is inefficient(11 points)
5. A point on the graph that is unattainable(11 points)
6. A point on the graph that is attainable(11 points)
8. If an individual preferred to have five times as many 2-liter bottles of cola as pizzas, what would be the optimal numbers of pizzas and colas that they would purchase? Explain.(12 points)
10. Now imagine that your budget has doubled. On the same graph, draw and label a new PFF.(11 points)
12. Is the point that was previously attainable still attainable?(11 points)
13. Is the point that was previously unattainable still unattainable?(11 points)

1.On one graph, draw and label all the following:

A.A production possibility frontier (PPF) which assumes a budget of $40, a price for pizzas of $10, and a price of $2 for a 2-liter bottle of cola

Cola will be on X axis. The maximum amount of Cola that can be purchased is =40/2=20, this the x-intercept will be 20.

Let pizza be on y axis. The maximum amount of pizza that can be purchased is =40/10=4, Thus the y-intercept will be 4.

The PPF will be a downward sloping straight line. This is because the slope of PPF is constant and equal=-Pcola/Ppizza=-2/10=-0.2

B.A point on the graph that is efficient. Any point on the PPF on the PPF is efficient such as E. PPF Pizza 4 F 20 cola.

C.point on the graph that is inefficient.Any point inside the PPF is inefficient such as I.PPF pizza 4-20 Cola

F

d. Point on the graph that is unattainable. Any point outside the PPF is unattainable such as U. PPF pizza 4.U20 cola

e.A point on the graph that is attainable. Any point on or inside the PPF is attainable such as A.PPF pizza 4 CA 20 Cola

2.If an individual preferred to have five times as many 2-liter bottles of cola as pizzas, what would be the optimal numbers of pizzas and colas that they would purchase?

The equation of PPF is:

C*Pcola + P*Pizza=budget

2C +10P=40

Substituting=5P,

10p + 10P=40

20P+40

P=2

And

C=5*2

C=10

Optimal number of Pizza=2

Optimal number of cola=10

3. Now imagine that your budget has doubled. On the same graph, draw and label a new PFF.

4.Is the point that was previously attainable still attainable?

Old PPF=PP

Previously the optimal consumption was attainable as it lies on the PPF at point E*. With double budget, the maximum amount of cola that can be purchased is =80/2, thus the x-intercept will be 40.

The maximum amount of pizza that can be purchased is=80/10=80, thus the y-intercept will be 8.

The new PFF=NN

5.Is the point that was previously unattainable still unattainable? No, Since the previous point E* lies inside the new PFF is still attainable.