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The labor force of an island country consists of only six workers. There are only two industries in this island, one producing X (for example, goods) and the other producing Y (for example, services). The following graph shows the production possibilities frontier (PPF) for this island country. It shows the effects on the production of X and Y from shifting workers from one industry to another one worker at a time. For example, suppose that currently X = 1 and Y = 125. Now, if we transfer worker from Y to X production, the production of X will increase to X = 2 and the production of Y will decrease to Y = 110. There are no externalities in production. = one = 140 135 130 125 120 115 110 105 100 95 90 Quantity of Y 0 O N 5 7 Quantity of X Marginal social cost of increasing the production of X from X = 2 to X = 3 in terms of the sacrifices of Y equals units? Marginal social cost of increasing the production of X from X = 3 to X = 4 in terms of the sacrifices of Y equals units? Do you remember the reasons for this result? Folder Homework Files/Week 2 Homework Files. Which of the following production points can be economically efficient? This question has more than one correct answer. Recall that another name for economic efficiency is allocative efficiency. Still another one? Pareto efficiency. OX= 2 & Y = 90 O X = 2 & Y = 110 X = 2 & Y = 125 X = 0 & Y = 135