The answers are 7 A 8 C 9 B Can someone please explain each

The answers are

7. A

8. C

9. B

Can someone please explain each problem?

VIDHVuonal Decision. For Questions 7 through 9, consider a society facing the Production Possibilities Curve illustrated below: Corn 1,350 1,000 1,000 800 500 375? . - Tanks 150 160 210 300 MA Which of the following combinations of output is \"feasible but characterized by productive inefficiency\"? A. \"A\" (150 Tanks and 375 bushels of Corn). \"B\" (300 Tanks and 500 bushels of Corn). \"D\" (210 Tanks and 1,000 bushels of Corn). More than one (perhaps all) of the above answers is correct. Starting at Point \"C\" (i.e., 210 Tanks and 800 bushels of Corn), if this society wanted to produce 90 more Tanks, then A. they could not increase their output of Corn, but they also would not have to decrease their output of Corn at all. they could also increase their output of Corn by 90 bushels. they would have to decrease their output of Corn by at least 300 units. they would no longer be able to produce any Corn whatsoever. If this society wanted to produce 650 bushels of Corn, then their maximum output of Tanks would be A. exactly 210 Tanks. more than 210 but fewer than 300 Tanks. C. exactly 300 Tanks. more than 300 Tanks.

Solution

a) The answer is \"A\"

Any point which is below the PPC represents inefficiency. The point lying on the PPC is the most efficient i.e. when the nation is producing at a point which is on the PPC then the economy is producing efficiently.

b) The answer is C. Any nation has limited resources with that limited resource they can produce only in good. If they have to produce another good they have to make a choice i.e. sacrifice some of the other good produced and use that resource for the production of other good which they want. Here, they have to sacrifice the amount of corns to produce more tanks.

c) When the nation produces 650 bushels of corn that falls between 210 and 300 tanks. So the number of tanks produced will be more than 210 but less than 300.