Question

Suppose that an economy produces only 2 goods: baseball bats and 2 x 4's. Also, the only input needed
to make these goods is trees. Basically, 1 tree makes 10 baseball bats, and 1 tree makes 20 2 x 4's. If
there are 5 trees in the economy, draw the production possibilities frontier for this economy.
HINT: Put bats on one axis and 2 x 4s on the other axis.
4. Plot any two points on the curve and label them A and B. Then, describe the opportunity cost (what
did you have to give up) by moving from point A to point B. (estimating is ok)
BATS

Answer 1

The production possibilities frontier is 50 baseball bats or 100 2 x 4's.

Production possibilities frontier

Supposing that an economy produces only 2 goods: baseball bats and 2 x 4's, and the only input needed to make these goods is trees, and 1 tree makes 10 baseball bats, and 1 tree makes 20 2 x 4's, to determine, if there are 5 trees in the economy, the production possibilities frontier for this economy, the following calculation must be made:

• 5 x 10 = x
• 50 =X
• 5 x 20 = x
• 100 =X

Therefore, the production possibilities frontier is 50 baseball bats or 100 2 x 4's.

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