Draw a production possibilities frontier representing the economy's possible production of milk and eggs. Now show what will happen to the frontier or the production point under each of the following circumstances. Use a separate graph to illustrate each situation.
a. the outcome for the economy is efficient, with society choosing approximately equal amounts of milk and eggs
b. a recession causes a significant percentage of the labour force to become unemployed
c. some cows are found to be infected with mad cow disease and many of the cows must be destroyed
d. chickens are infected with a rare disease and egg-laying is reduced
e. improvements in animal nutrition raise the general productivity of cows and chickens
f. the cow and chicken populations increase
g. the Surgeon General announces that drinking milk prolongs life

Question

Quizplus · Accepted Answer

The Answer of Draw a production possibilities frontier representing the economy's possible production of milk and eggs. Now show what will happen to the frontier or the production point under each of the following circumstances. Use a separate graph to illustrate each situation.
a. the outcome for the economy is efficient, with society choosing approximately equal amounts of milk and eggs
b. a recession causes a significant percentage of the labour force to become unemployed
c. some cows are found to be infected with mad cow disease and many of the cows must be destroyed
d. chickens are infected with a rare disease and egg-laying is reduced
e. improvements in animal nutrition raise the general productivity of cows and chickens
f. the cow and chicken populations increase
g. the Surgeon General announces that drinking milk prolongs life

Draw a Production Possibilities Frontier Representing the Economy's Possible Production