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The Boswell Fruit Farm produces only oranges and papaya. Table 1 below shows the maximum possible output combinations of the two fruits using all resources

  1. The Boswell Fruit Farm produces only oranges and papaya. Table 1 below shows the maximum possible output combinations of the two fruits using all resources and currently available technology. Answer the questions below and show calculations where appropriate. (25 points)

Table 1

Boswell Fruit Farm
Possible Output Combinations Oranges Papayas
(thousands of kilos) (thousands of kilos)
A 140 0
B 120 20
C 100 38
D 80 52
E 60 64
F 40 74
G 20 80
H 0 82

a. Suppose the Fruit Farm is currently producing at point F. What is the opportunity cost of producing an additional 10,000 kilos of oranges?

b. Which of the possible output combinations represent the lowest opportunity cost for one thousand kilos of papayas? Show your calculation to support your answer.

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