Macroeconomics 11th Edition by Michael Parkin

Exercise 8

Production Possibilities and Opportunity Cost
Use the following table to work Problem. Suppose that Yucatan's production possibilities are
a. Draw a graph of Yucatan's PPF and explain how your graph illustrates a tradeoff.
b. If Yucatan produces 150 pounds of food per month, how much sunscreen must it produce if it achieves production efficiency
c. What is Yucatan's opportunity cost of producing 1 pound of food
d. What is Yucatan's opportunity cost of producing 1 gallon of sunscreen
e. What is the relationship between your answers to parts (c) and (d)