Question
Suppose Sri Lanka produces two commodies: wheat and cloth. Use the production possibility schedule to answer the questions below. A B C D E F
Suppose Sri Lanka produces two commodies: wheat and cloth. Use the production possibility schedule to answer the questions below.
| A | B | C | D | E | F | G | |
| Cloth (units) | 0 | 10 | 20 | 30 | 40 | 50 | 60 |
| Wheat (in tons) | 100 | 95 | 85 | 70 | 50 | 30 | 0 |
a. f the economy is currently producing at position E, answer the questions below.
- What is the opportunity cost of producing 10 more units of cloth? (2 Marks)
- What is the opportunity cost of producing 45 more tons of wheat? (2 Marks)
b. Refer to the case study provided to you in class entitled "Typhoon Haiyan's deadly impact on the Philippines". Use the figure below to answer the questions that follow.
Figure showing the effects of Typhoon Haiyan on demand and supply of rice in Philippines
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Managerial Economics
Authors: Mark Hirschey
12th edition
978-0324588866
