Figure 2-10
Refer to Figure 2-10. If this economy put all available resources into the production of bananas, it could produce
A) 200 bananas and also 150 baseballs.
B) 300 bananas and also 100 baseballs.
C) 400 bananas and no baseballs.
D) It is impossible to know unless we know the quantity of resources available.

Question

Figure 2-10 
Refer to Figure 2-10. If this economy put all available resources into the production of bananas, it could produce
A) 200 bananas and also 150 baseballs. 
B) 300 bananas and also 100 baseballs. 
C) 400 bananas and no baseballs. 
D) It is impossible to know unless we know the quantity of resources available.

Quizplus · Accepted Answer

The economy is on the production possibilities frontier curve (PPF) for bananas and baseballs, meaning it is using all available resources efficiently. Therefore, the maximum amount of bananas it could produce is shown by point L on the PPF, which is 400 bananas. Since the economy is already using all available resources, it cannot produce any baseballs without sacrificing some banana production. Therefore, the answer is C, 400 bananas and no baseballs.

Figure 2-10 Refer to Figure 2-10. If This Economy Put All Available