Production Possibilities Frontier Practice Problem Assume the following possible combinations of potatoes and tractors that could be produced yearly: Alternatives Potatoes Tractors A B C D E 60 55 45 30 0 0 30 50 60 65 Using this information, create a production possibilities curve (PPC) with potatoes on the vertical axis

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Production Possibilities Frontier Practice Problem Assume the following possible combinations of potatoes and tractors that could be produced yearly: Alternatives Potatoes Tractors A B C D E 60 55 45 30 0 0 30 50 60 65 Using this information, create a production possibilities curve (PPC) with potatoes on the vertical axis. Be as exact and as neat as possible. (remember to label your graph!) Use your PPC to answer the following questions: a. If society is currently producing alternative B, then the opportunity cost of moving to alternative C equals the value of_________________________. b. With these possibilities, producing 18 potatoes and 50 tractors would be_____________________. c. An example of the principle of increasing opportunity costs in this table is that going from B to C costs more potatoes than going from _______ to point_______. d. Suppose the technology used in producing potatoes improves while that for producing tractors does not. Draw one POSSIBLE new PPC in the graph above which represent the results of this change. Indicate the direction of the change that occurs with big arrows. e. After the change seen in question d, when 30 tractors are being produced we will be able to produce more than _______ potatoes. f. An impossible production mix would be _________________the PPC, while a productively inefficient production mix would be ___________________the PPC.