Question

1.4 Creating and Interpreting a Production Possibilities Curve Your task: using the data below, construct the production possibilities curve for the hypothetical country of Michigania The country produces only two products: caps and balls (yes, they love sports in Michigania). Next, answer the questions that follow Production Possibility Number of caps (In milion) Number of balls (n millions 35 50 65 sO 68 54 35 You can draw this by hand, or you can use Word Art to label the graph and draw the curve. Your graph must have the following items: (5 points) 1. Axis labels for balls and caps. 2. Axis numbering for the main lines on the graph. 3. Points A through E indicated on the graph. 4. The production possibilities curve. Questions to Answer: (5 points each Please use complete sentences for full credit) 1. What is the trade-off if Michigania elects to produce only balls? 2. What is the opportunity cost of producing 75 million caps in Michigania? . How might Michigania be able to expand the production possibilities curve?

Answer 1