Macroeconomics 11th Edition by Michael Parkin

Exercise 31

Use the following information to work Problem. Brazil produces ethanol from sugar, and the land used to grow sugar can be used to grow food crops. Suppose that Brazil's production possibilities for ethanol and food crops are as follows
a. Draw a graph of Brazil's PPF and explain how your graph illustrates scarcity.
b. If Brazil produces 40 barrels of ethanol a day, how much food must it produce to achieve production efficiency
c. Why does Brazil face a tradeoff on its PPF